LOS ANGELES - Virgin Galactic's pioneering spacecraft designed to take tourists into space crashed on Friday in California, killing one of the two pilots and scattering debris across the desert.
Television images showed parts of SpaceShipTwo, a test vehicle flying to the edge of space, scattered amid brush in the desert east of Mojave, a few hours' drive north-east of Los Angeles.
The incident is second disaster involving a US spacecraft this week, after an unmanned Orbital Science rocket exploded on Tuesday six seconds after launch on a resupply mission to the International Space Station.
It is also a huge blow to British tycoon Richard Branson's long-held dream of offering the first passenger space flights, which have been snapped up by celebrities including Leonardo DiCaprio.
The Virgin chief said he was heading straight to the site.
"Thoughts with all @virgingalactic... I'm flying to Mojave immediately to be with the team," he wrote on Twitter.
It was not clear where the globe-trotting tycoon was at the time of the crash.
"During the test, the vehicle suffered a serious anomaly resulting in the loss of SpaceShipTwo. Our first concern is the status of the pilots, which is unknown at this time," Virgin Galactic had said in an earlier tweet.
The California Highway Patrol confirmed reports that one pilot had died and another was seriously injured and had been taken to hospital.
"We will work closely with relevant authorities to determine the cause of this accident and provide updates as soon as we are able to do so," the company said.
Officials were due to give a press conference at 2pm (5am Singapore time) to release more details of the accident, according to the KGET local TV station.
The spaceship had been carried aloft on a bigger aircraft known as WhiteKnightTwo and then released for a test of its rocket engine above the Mojave desert, in what was the 35th such flight.
"SpaceShipTwo has been released by WhiteKnightTwo, and is now flying freely," the firm wrote in a blow-by-blow account of the flight, adding: "Ignition! SpaceShipTwo is flying under rocket power again."
The next tweet announced the "anomaly", followed by the series confirming the crash.
The company added that WhiteKnightTwo had landed safely after the accident.
The US air safety agency, the National Transportation Safety Board, said it was sending a team to the site of the crash.
More than 500 people have already reserved seats - and paid a deposit on the US$200,000 (S$257,000) ticket price - for a minutes-long suborbital flight on SpaceShipTwo, which can carry six passengers.
It is the commercial version of SpaceShipOne, the first private spacecraft to reach the edge of space in 2004, and which is now on displace at the National Air and Space Museum in Washington.
The spacecraft is carried to an altitude of about 13,000m and released. It then fires its rocket motor to catapult it to about 100km above Earth, giving passengers a view of the planet set against the blackness of space and a few minutes of weightlessness.
Private companies are rushing to fill the gap left by Nasa, which ended its 30-year shuttle programme in July with the completion of the final Atlantis mission to the International Space Station (ISS).
DiCaprio and fellow actors Ashton Kutcher and Demi Moore are among those already reported to have booked their place.
Earlier this year, Titanic star DiCaprio auctioned off a trip with him into space, raising 700,000 euros (S$1.1 million).
Friday's incident is the second involving a spacecraft this week, after the Orbital Science rocket exploded six seconds after launch on a resupply mission to the ISS.
Initial investigations into that explosion centred on the pair of rocket engines providing its thrust, which were made during the Soviet era and refurbished.
The Ukrainian-designed AJ-26 engines date back to the 1960s and 1970s, and Aerojet Rocketdyne of Sacramento, California has a stockpile that it refurbishes for Orbital Sciences.