Click on the image above to see a larger version of the cutaway
HOTOL was initially developed by the British during the 80s, back when the US was pushing the space shuttle. Unlike the shuttle, it was an horizontal take-off and landing concept that used concepts like "heat exchangers, oxidiser cooled combustion chamber, or adaptive nozzles" instead of the classic rocket technology available at that time. The concept was so hot back then that the US government was secretly looking into it as a potential technology to use themselves.
Today, a company called Reaction Engines is working in reviving HOTOL into a new project called Skylon. The engineers—who used to work in HOTOL—have just got a good chunk of money from the European Union, and are working with a $8.7 million budget to jump start the new aircraft.
Skylon will be as long as the Concorde and carry 15,400-pound payloads to low Earth orbit into its 15-foot diameter cargo bay.