Blue Origin, the private rocket company run by Amazon founder Jeff Bezos, performed the first airborne test of its vehicle’s emergency escape system today over the Texas desert.

The spectacular in-flight test appeared to go perfectly and was immediately declared a success as the New Shepard rocket booster and capsule separated high in the sky and later touched down one after the other, undamaged.

The dramatic demonstration, which drew swift congratulations from Nasa, will go down as a milestone in the company’s plans to build reusable rockets that can take people into space for a fraction of the cost that space tourists pay today.

The New Shepard rocket launched shortly after 10.30am local time and climbed to an altitude of 16,000 feet before controllers sent a command that ordered the rocket to trigger the built-in escape system.

Cameras on the ground captured the moment the unmanned crew capsule blasted free of the rocket booster and streaked ahead on a pillar of fire. Moments later, it released its giant blue and red parachutes and floated back to Earth. The capsule landed at about 3mph and threw up a cloud of dust on impact.

The booster itself continued on its way to space before plummeting back to the ground on a pre-programmed trajectory. As the booster fell through the air, its engine fired up again, and eventually brought the somewhat singed rocket to a standstill on the desert floor.

Flight controllers cheered as the capsule separated and both parts of the vehicle touched down. “Beautiful!” exclaimed a Blue Origin commentator.

The emergency escape system is for use should a glitch ever endanger a future crew onboard the snub-nosed rocket. As soon as a life-threatening problem is detected, the capsule would ignite its own rocket engine and blast a safe distance away from the booster. The capsule would then release parachutes to stabilise and slow its descent.

Engineers were not convinced the booster would survive the violence of the separation, but in the test, the rocket appeared to be unharmed and continued on its course into space. When the capsule separated, its rocket engine will have roasted the booster with 70,000 pounds of thrust.

Writing on his blog before the launch, Jeff Bezos called the flight “our toughest test yet” and said that if the booster survived the ordeal, they would reward it with a retirement party. “Our next flight is going to be dramatic, no matter how it ends,” he wrote. The in-flight test of the escape system follows a run of tests on the ground and on the launchpad.

Named after Alan Shepard, the first American in space, the New Shepard rocket and capsule are intended for suborbital flights into space. Bezos wants to start launching tourists in the years ahead and hopes to keep costs down by making the rockets reusable.