Boeing had never built the kind of spy satellites the government was seeking. Yet when Boeing said it could live within the stringent spending caps imposed by Congress and the satellite agency, the government accepted the company’s optimistic projections, a Panglossian compact that set the stage for many of the travails that followed. Despite its relative inexperience, Boeing was given responsibility for monitoring its own work, under a new government policy of shifting control of big military projects to contractors. At the same time, the satellite agency, hobbled by budget cuts and the loss of seasoned staff members, lacked the expertise to make sound engineering evaluations of its own.

The satellites were loaded with intelligence collection requirements, as numerous intelligence and military services competed to influence their design. Boeing’s initial design for the optical system that was the heart of one of the two new satellite systems was so elaborate that optical engineers working on the project said it could not be built. Engineers constructing a radar-imaging unit at the core of the other satellite could not initially produce the unusually strong radar signal that was planned.

A torrent of defective parts, like gyroscopes and electric cables, repeatedly stalled work. Even an elementary rule of spacecraft construction — never use tin because it deforms in space and can short-circuit electronic components — was violated by parts suppliers.

By the time the project, known by its initials, F.I.A., was killed in September 2005 — a year after the first satellite was originally to have been delivered — cost estimates ran as high as $18 billion.

“The F.I.A. contract was technically flawed and unexecutable the day it was signed,” said Robert J. Hermann, who ran the National Reconnaissance Office from 1979 to 1981 and in 1996 led the panel that first recommended creation of a new satellite system. “Some top official should have thrown his badge on the table and screamed, ‘We can’t do this system at this price.’ No one did.”

Boeing’s point man on the job was Ed Nowinski, an engineer who had become a top government spy satellite expert during 28 years at the Central Intelligence Agency. “It was a perfect storm,” Mr. Nowinski said ruefully. But he acknowledged that Boeing frequently provided the government with positive reports on the troubled project.

“Look, we did report problems,” Mr. Nowinski said, “but it was certainly in my best interests to be very optimistic about what we could do.”