A $16 million contract signals Pentagon interest in satellite systems that can track targets continuously, process data on board and deliver faster decisions at the tactical edge
BAE Systems has secured fresh backing from the US Defense Advanced Research Projects Agency to push autonomous surveillance technology further into orbit, underscoring how space is becoming a frontline domain rather than a distant support layer.
DARPA has awarded the company’s FAST Labs unit a $16 million Phase 2 contract under its Oversight program, aimed at building systems that can maintain constant awareness of activity on Earth using large, networked satellite constellations.
From experiment to expansion
The Phase 2 award follows what both DARPA and BAE Systems describe as a successful first stage.
During Phase 1, BAE’s software was integrated into a modeling and simulation environment that mimicked real satellite and sensor behavior. The goal was simple in theory, hard in practice: show that an automated system could keep track of multiple targets over time without human micromanagement.
It worked well enough to move forward.
Phase 2 raises the bar. BAE Systems will now refine its algorithms and prove they can function across much larger satellite constellations, more demanding operational scenarios and higher-fidelity simulations.
One short line sums up the shift: this is no longer a lab demo.
What “custody” means in modern surveillance
DARPA’s Oversight program revolves around the idea of continuous “custody,” a term that carries specific weight in military planning.
Custody means knowing where something is, what it’s doing and whether that understanding is uninterrupted. Losing custody, even briefly, can create blind spots that adversaries exploit.
Traditionally, space-based surveillance relied heavily on ground stations to process data and issue instructions. That approach adds delay. It also limits how often satellites can revisit the same area.
Oversight aims to flip that model.
By pushing more processing and coordination onto the satellites themselves, the system can react faster, revisit targets more often and reduce reliance on constant human input.
Basically, the satellites start thinking for themselves.
Pushing intelligence to the tactical edge
Dr. Ben Cooper, senior principal scientist at BAE Systems FAST Labs, framed the effort in terms of changing mission demands.
“Future mission requirements are pushing capabilities to the tactical edge,” he said. In space, that means satellites doing more work on board rather than waiting for instructions from Earth.
That distinction matters.
In contested environments, communications links can be degraded, delayed or disrupted entirely. Systems that depend on constant ground contact become brittle. Autonomous systems, by contrast, can keep functioning even when cut off.
For warfighters, the payoff is speed.
Lower latency means intelligence arrives sooner. Higher revisit rates mean fewer gaps in coverage. Together, those factors can compress decision timelines in ways that shape outcomes on the ground.
A crowded sky with a new role
The Oversight program also reflects a broader shift in how the US military views satellite constellations.
Instead of a handful of large, exquisite spacecraft, planners are increasingly interested in proliferated networks of smaller satellites. These constellations are harder to disrupt and easier to refresh.
BAE’s software is being built with that scale in mind.
Phase 2 work will involve demonstrating how the system performs as the number of satellites grows and as scenarios become more complex. That includes juggling different sensor types, orbital paths and mission priorities at once.
One sentence captures the challenge: scale breaks systems faster than anything else.
On-board processing changes the equation
A key feature of the Oversight effort is where the data gets processed.
Rather than sending raw information down to Earth for analysis, the system performs coordination and decision-making in space. That reduces the amount of data that needs to travel back and forth and speeds up response times.
The benefits are concrete:
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Faster detection and tracking
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Less dependence on continuous ground contact
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Better resilience in contested environments
This approach also aligns with broader Pentagon thinking about distributed operations, where no single node becomes a critical failure point.
Space, in this view, is no longer a passive sensor layer. It’s an active participant.
From simulation to real hardware
Phase 2 isn’t limited to digital models.
BAE Systems says the technology will be physically deployed on both satellites and ground stations as part of the program. That step is crucial for identifying issues that don’t show up in simulation, from power constraints to thermal limits.
The work will take place primarily at BAE facilities in Burlington, Massachusetts, and Merrimack, New Hampshire. The company will also collaborate with subcontractor AIMdyn, Inc., which specializes in decision-support and autonomy tools.
This mix of in-house development and outside collaboration is typical of DARPA programs, which often blend academic-style research with defense-grade engineering.
Why DARPA is leaning in
DARPA’s role is to take risks others won’t.
The agency funds ideas that may not fit neatly into existing acquisition programs but could redefine future capabilities. Autonomous space surveillance sits squarely in that category.
The war in Ukraine, tensions in the Indo-Pacific and increased activity by China and Russia in space have sharpened US interest in persistent awareness. Satellites that can track movements, changes and patterns continuously are a strategic asset.
DARPA’s Oversight program is an attempt to build that capacity before it’s urgently needed.
One short paragraph says a lot: the future fight may start above the atmosphere.
Competitive implications for the defense sector
For BAE Systems, the contract strengthens its position in a competitive corner of the defense market.
Major players, including Lockheed Martin, Northrop Grumman and RTX, are all investing heavily in space autonomy, sensing and data fusion. Winning Phase 2 funding from DARPA signals technical credibility and keeps BAE in the conversation for future programs of record.
FAST Labs, in particular, acts as BAE’s bridge between research and deployment. Success here can feed into larger contracts down the line.
Investors tend to watch DARPA awards closely. They don’t guarantee follow-on business, but they often point to where defense spending may head next.
Ethical and strategic questions linger
Autonomous surveillance also raises uncomfortable questions.
Who controls the system’s priorities. How decisions are audited. What safeguards exist to prevent errors from cascading.
DARPA typically frames autonomy as decision support rather than decision replacement, but the line can blur as systems grow more capable.
For now, Oversight remains focused on tracking and awareness, not engagement. Still, the idea of satellites coordinating surveillance without constant human oversight will attract scrutiny.
Those debates, however, are unlikely to slow development.
A longer view of space as infrastructure
Stepping back, the Oversight program fits into a larger redefinition of space.
Once treated as a strategic high ground used mainly for communications and navigation, orbit is now being asked to deliver near real-time intelligence, persistently and at scale.
That shift requires new software, new architectures and new assumptions about autonomy.
BAE Systems’ Phase 2 contract won’t solve all of that. But it nudges the system forward.
