The 2ft-wide radio transmitter, which became the first ever man-made object to leave the atmosphere, was capable of circling the earth every 90 minutes.
Thrilled amateur radio operators were also able to pick up signals from Sputnik, which also delighted much of the world’s scientific community.
But it also raised Cold War tension as Americans feared that the rocket that launched the 188lb satellite might be capable of delivering nuclear weapons thousands of miles.
The fact that Sputnik flew over the U.S. seven times a day caused further unease and the country began a battle to close the technological gap with its communist rival.
In the process, both countries developed rockets that could fire nuclear warheads at each other and the U.S. ultimately won the Space Race by landing men on the moon.
But in the early years, it was the Soviets who scored the biggest advances and – to American consternation – raised the prestige of the communist system.
Sputnik – simply meaning satellite in Russian - particularly irked the U.S because the U.S. had previously twice failed to launch a transmitter under Project Vanguard.
A month later American politicians were further angered and dismayed when their former World War II allies launched sent the first living animal into Space.
A British Pathe newsreel filmed the dog Laika before she died “painlessly” in orbit aboard Sputnik II on November 3, 1957.
In response, U.S. President Dwight Eisenhower ordered more of his country’s superior economic resources to be devoted to the Space Race.
But the Americans suffered another setback when, on December 6, their third rocket crashed, leading to the Daily Express nicknaming the craft “flopnik”.
The U.S. Army finally put their own satellite in space on January 31, 1958 – with the National Aeronautics and Space Adminstration (NASA) being set up soon after.
By December 1958, the Americans had sent a living creature into space and in May 1959 monkeys Able and Baker became the first animals to survive the trip.
But the Americans' achievements were eclipsed on April 12, 1961 when the Soviet Union put the first human, Yuri Gagarin, into space.
Just weeks later, Alan Shepherd became the first American to be sent into the orbit and from then on both sides competed to be the first to put a man on the moon.
The Americans got there first – and effectively won the Space Race – when Neil Armstrong, Buzz Aldrin and Michael Collins touched down on July 20, 1969.
Armstrong took the first ever steps on the moon and famously declared: “That's one small step for man, one giant leap for mankind.”
Yet few people at the time realised just how close the USSR came to dashing JFK’s dream.
The secretive Soviets kept under wraps the fact that, 17 days earlier, its own N1 moon rocket exploded seconds after lift-off, causing the biggest non-nuclear blast in history.
Details of explosion, which was powerful enough to level a town the size of Luton, were only revealed after the fall of communism in the 1990s.
The lid was also lifted on how the brave Bolsheviks kept on trying – and failing – with ten launches between 1969 and 1974, when its moon programme was axed.
NASA successfully landed six manned shuttles on the moon between 1969 and 1972 when the U.S. government ended its expensive programme.