The British entrepreneur applauded and cheered as SpaceShipTwo, VSS Unity touched back down at the Mojave test centre in California.
The Air Force considers 50 miles up as the point at which space begins, CBS News space consultant William Harwood reported.
Virgin Galactic's development of its spaceship took far longer than expected and endured a setback when the first experimental craft broke apart during a 2014 test flight, killing the co-pilot. It was an indescribable feeling: "joy, relief, exhilaration and anticipation for what is yet to come".
That day can not come soon enough for Mercury 13 candidate Wally Funk, who booked her flight on Branson's dream machine back in 2012 and at 79 might finally get a chance to go to space.
"Today we have shown Virgin Galactic can open space to the world", Branson said, adding he aimed for a commercial space flight with passengers - including himself - by March 2019.
More than 600 people have all bought tickets to be on the first round of commercial space flights in six-passenger rockets by Virgin for up to $250,000 (£200,000) a ticket.
That altitude meets at least one definition of where space begins.
Virgin's latest flight test comes four years after the original SpaceShipTwo crashed during a test flight that killed the co-pilot and seriously injured the pilot, dealing a major setback to Virgin Galactic, a USA offshoot of the London-based Virgin Group.
New versions of SpaceShipTwo were built by a Virgin Galactic sister company and flight testing taken in-house.
Besides VSS Unity, two more SpaceShipTwo vehicles are now under construction, with the first of them expected to be completed in about a year. Earlier this year, the supersonic plane climbed to about 32 miles during its third-ever rocket-powered flight. Blue Origin will use the more traditional method of spacecraft attached to a rocket launched from the ground.
That's different than a long-held view that the boundary is at 100 kilometres. but CEO George Whitesides noted that recent research favours the lower altitude. It then detaches from the plane, ignites its rocket engine and climbs. Amazon founder Jeff Bezos launched Blue Origin, which also plans to take space tourists on suborbital trips.
Virgin Galactic has more tests of VSS Unity planned before moving to Spaceport America in New Mexico where it will set up its tourism operation. These missions will allow customers to experience a few minutes of weightlessness and also see the curvature of Earth against the blackness of space, company representatives have said. After the rocket plane topped 50-mile altitude, reaching an apogee of 51.4 miles above earth, a crying Branson high-fived and hugged spectators.More news: House Democrats to seek Trump's tax returns, Pelosi says
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