Upon reaching a designated height, an expendable upper stage would separate from the space plane, and insert a payload into low-Earth orbit (LEO). The spaceplane would then autonomously land and be serviced for the next launch.

Phase 1 of the program saw DARPA award contracts to three companies, each of which was paired with a launch service provider. The teams were tasked with analyzing the feasibility of the project, and designing their own versions of the launcher.

"During Phase 1 of the XS-1 program, the space industry has evolved rapidly and we intend to take advantage of multiple impressive technological and commercial advances," states Jess Sponable, program manager for the XS-1. "We intend to leverage those advances along with our Phase 1 progress to break the cycle of escalating DoD space system launch costs, catalyze lower-cost satellite architectures, and prove that routine and responsive access to space can be achieved at costs an order of magnitude lower than with today's systems."