The LUTZ Pathfinder, built by Transport Systems Catapult (TSC), had to navigate walkers and cyclists while travelling through pedestrianised areas of Milton Keynes.
Using virtual maps, the vehicle was able to drive itself around the Buckinghamshire town in the busy area close to the train station.
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The car reached speeds of up to 15mph, though a driver was on board to deal with any incidents that may have taken place.
It comes as major motor manufacturers all over the world vie to become the first to develop their own autonomous vehicle technology.
BMW Group is just one of the firms to have unveiled plans for driverless vehicles, which could see fully autonomous Minis on call to pick up drivers at any time of the day or night.
And the automotive sector has faced tough competition from other industries as it races to incorporate the technology into its vehicle designs.
Google has been testing self-driving cars close to its Silicon Valley headquarters in California, while Uber users in Pittsburgh have also been able to request a pickup from driverless vehicles.
But TSC, one of 10 elite technology and innovation centres set up by the UK’s innovation agency Innovate UK, is the first manufacturer to test the technology in Britain.
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The test, which the company said had been a success, comes after 18 months of development and research by TSC.
Its Pathfinder is equipped with an on-board computer that can build up a picture of the surrounding area using cameras and lidar, a kind of radar system.
In the test, the manufacturer was also interested to gauge the public’s reaction to the vehicle.
It is also hoped the demonstration will spur on the creation of regulations that will need to be introduced before the technology can fully get off the ground.
The test will now help to pave the way for other manufacturers to carry out similar demonstrations of their own, according to TSC’s Neil Fulton.
“Driverless vehicles are coming to Britain and what we have demonstrated today is a huge step on that journey,” he said.