[2] In addition to military applications, the prospect of applying such technology to commercial airliners was also viewed with considerable interest by the mid-1950s, thus the value of developing viable vertical take-off systems was judged to be substantial.

[10] Aviation author Francis K. Mason expressed a contrary view, stating that Hawker's decision to proceed was independent of British government initiatives, and that the P.1127 project was primarily based upon the NATO requirement instead.

The close cooperation between Hawker and Bristol was viewed by project engineer Gordon Lewis as a key factor which had enabled the P.1127's development to proceed in spite of technical obstacles and political setbacks.

[2] The design process extended throughout 1958, being financed entirely by Hawker, while approaches were made to NATO headquarters (Belgium) to better establish the tactical requirements sought, particularly between the conflicting demands for a lightly armed supersonic fighter and a simpler multipurpose subsonic one.

[14] Throughout the development, Camm heavily emphasised the importance of the design's simplicity, observing that "Sophistication means complication, then in turn escalation, cancellation, and finally ruination".

[13] During late 1958, the rapid progress of the P.1127 project had been noticed by technical advisors at NATO, who began promoting the acceleration of the aircraft's development and that member nations should skip over the next generation of support fighters in favour of the emergent P.1127 instead.

[13] As the P.1127 had been developed at a time of deep UK defense cuts, Hawker had to seek commercial funding, and significant engine development funding came from the U.S.[9][15] Research assistance was also provided by the U.S., including a series of wind tunnel tests conducted by NASA's Langley Research Center using sub-scale models, which demonstrated acceptable flight characteristics.

[16] However, there were critics amongst the Air Staff of the project, typically disliking the P.1127 for its subsonic speeds, favouring supersonic-capable aircraft instead; Mason attributes this as having caused considerable delay in the issuing of a contract to Hawker.

[20] On 15 July 1960, the first "P.1127 Prototype V/STOL Strike Aircraft", serial XP831, was delivered to Dunsfold Aerodrome, Surrey, to commence static engine testing.

Some of the tests were performed from a purpose-built platform at the aerodrome which functioned to deflect the hot exhaust gases away from the aircraft during early hovering trials while more powerful versions of the engine were developed.

[21] On 21 October 1960, the initial tethered flight, performed by XP831, was conducted at Dunsfold; at this stage of development, this feat had required the airframe to have been stripped of all extraneous weight and restrictions on the engine meant it could not be run at full power for more than 2.5 minutes at a time.

[23] Soon after this, XP831 was refitted with a new model of the Pegasus engine, capable of generating 12,000 lbf (53 kN) of thrust, prior to embarking on new hovering trials in May 1961.

In June, XP831 attained another milestone in the program when it performed the first transition from vertical hover to horizontal flight, initially flying the length of Dunsfold's runway at a height of 50 meters.

[9][23] During September, the feat was repeated multiple times by both prototypes, transitioning from vertical to horizontal flight and vice versa, including instances in which the auto-stabiliser was intentionally disabled.

[21] As such, in 1961, there was little military interest in the P.1127 program, although, in January 1961, Hawker was requested to provide a quote for the costs involved in a potential 100 production standard P.1127 aircraft.

[25] Meanwhile, Hawker believed that the continuing development of the P.1127 would serve a successful demonstration, acting to dissuade potential customers from pursuing competing 'paper' VTOL aircraft projects.

[23] On 2 November 1960, the Ministry of Supply issued a contract for a further four prototypes to be produced, which were intended to develop the aircraft further towards being a realistic combat design, such as the refinement of the wing, engine improvements, and of accompanying operational equipment.

In light of open interest expressed by figures within the U.S. and West Germany, the British government approached these nations with an offer to collaborate on the project and to seek contributions towards the cost involved.

[28] Prior to the availability of the Kestrel for testing, a pair of NASA pilots visited Dunsfold to perform a complete set of handling trials using the earlier P.1127 in its place.

[28] During the course of the evaluation, the Tri-partite pilots developed a typical sortie routine for the Kestrel of conducting short take-offs (STO) and returning to base on vertical landings.

[40] One of the two remaining British-based Kestrels was attached to the Blind Landing Experimental Unit (BLEU) at RAE Bedford and the other, XS693, went to Blackburn for modification to take the uprated Pegasus 6 engine.

[42] Experience gained during naval testing on board the commando carrier HMS Bulwark in 1966 convinced project officers that less reactive materials would be substituted for all uses of magnesium in the Kestrel's airframe, in any further prototypes and production aircraft.

[54] The P.1127 lacked any in-built armaments, the ethos of tactical flexibility meant a reliance upon underwing hard point-mounted munitions and equipment, which included multiple 2-inch (51 mm) rocket batteries, 30-mm ADEN cannon gun pods, and 1,000 lb (450 kg) bombs, napalm, and range-extending drop tanks.

[54] The prototypes were furnished with long nose-mounted instrumentation booms, which were replaced on the Kestrel with a much smaller counterpart on the fin to enable the nose to accommodate a tactical camera instead.

An unusual feature of the P.1127 was the installation of a ram air turbine upon the rear fuselage just forward of the fin to provide power for ancillary services in the event of engine failure.