Group does not exist.

Hello all,

I'm trying to grant select privileges to members of a group.
I created the group (testgroup), added users, and when I

grant select on employee to testgroup;

in psql "ERROR Group testgroup does not exist" is returned.

I've tried this in Xpg, the psql command line, and using DBVisualizer, all
with identical results.
The group is listed in pg_group along with the IDs of the users I wanted
assigned to the group.
I was able to grant the privileges by iterating through the individual
users.

Any help is appreciated.
Bob