On July 27, 2004, the X PRIZE Foundation announced that Scaled Composites had given notice that they would make their first competitive flight on September 29, 2004.

The pilot initially selected for the flight withdrew due to stress about two weeks before the flight, after his wife gave birth and he also fell ill. Mike Melvill, who also piloted SpaceShipOne's sole previous spaceflight, stepped in to fly in his place.

Melvill was seen as a surprise choice, because after the previous flight he had said he wanted to take a break from flying SpaceShipOne and ride his motorbike more.

Scaled Composites announced early on that this, their first X PRIZE flight, would carry inanimate payload rather than live passengers.

Scaled Composites employees were made to sign a contract forbidding them from selling the mementos they put on the flight.

The flight was planned to take off from Mojave Spaceport in the early morning, when wind conditions are most favourable.

The pilot was not highly concerned by this, being confident that he could correct the situation, and he allowed the burn to continue during the roll.

When there was sufficient velocity to assure the achievement of the target altitude, as predicted by the navigational system, the ground controllers recommended that the pilot abort the burn.

He promptly did so, 76 s into the burn, cutting it short by 11 s. After engine cutoff, the craft continued climbing while rolling.

Atmospheric reentry proceeded normally, with the craft rapidly righting its attitude due to the stable high-drag configuration.

Distinguished attendees included: At 06:09, shortly before planned takeoff, spectators were told to stay at the spaceport after the flight, to hear a "major announcement" about the future of the X PRIZE Foundation.

[citation needed] To win the X PRIZE, a spacecraft must make two successful competitive flights within 14 days.