Abstract Atmospheric escape is a fundamental process that affects the structure, composition, and evolution of many planets. The signatures of escape are detectable on close-in, gaseous exoplanets orbiting bright stars, owing to the high levels of extreme-ultraviolet irradiation from their parent stars. The Colorado Ultraviolet Transit Experiment (CUTE) is a CubeSat mission designed to take advantage of the near-ultraviolet stellar brightness distribution to conduct a survey of the extended atmospheres of nearby close-in planets. The CUTE payload is a magnifying near-ultraviolet (2479–3306 Å) spectrograph fed by a rectangular Cassegrain telescope (206 mm × 84 mm); the spectrogram is recorded on a back-illuminated, UV-enhanced CCD. The science payload is integrated into a 6U Blue Canyon Technology XB1 bus. CUTE was launched into a polar, low-Earth orbit on 2021 September 27 and has been conducting this transit spectroscopy survey following an on-orbit commissioning period. This paper presents the mission motivation, development path, and demonstrates the potential for small satellites to conduct this type of science by presenting initial on-orbit science observations. The primary science mission is being conducted in 2022–2023, with a publicly available data archive coming online in 2023.