We introduce the fluctuating two-ray (FTR) fading model, a new statistical channel model that consists of two fluctuating specular components with random phases plus a diffuse component. The FTR model arises as the natural generalization of the two-wave with diffuse power (TWDP) fading model; this generalization allows its two specular components to exhibit a random amplitude fluctuation. Unlike the TWDP model, all the chief probability functions of the FTR fading model (PDF, CDF, and MGF) are expressed in closed-form, having a functional form similar to other state-of-the-art fading models. We also provide approximate closed-form expressions for the PDF and CDF in terms of a finite number of elementary functions, which allow for a simple evaluation of these statistics to an arbitrary level of precision. We show that the FTR fading model provides a much better fit than Rician fading for recent small-scale fading measurements in 28 GHz outdoor mm-wave channels. Finally, the performance of wireless communication systems over FTR fading is evaluated in terms of the bit error rate and the outage capacity, and the interplay between the FTR fading model parameters and the system performance is discussed. Monte Carlo simulations have been carried out in order to validate the obtained theoretical expressions.