This paper describes the system firing tests of a precooled-cycle hypersonic turbojet engine (Precooled Turbojet : PCTJ) for the first stage of the TSTO spaceplane and hypersonic airplane. In 2004, JAXA started to develop a subscale precooled turbojet engine (S-engine) to demonstrate the engine performance under the overall flight condition. S-engine consists of a core jet-engine, variable air-intake, precooler and variable nozzle with an afterburner. It has 23 cm × 23 cm of rectangular cross section, 2.2 m of the overall length, 100 kg of the weight and 1.2 kN of thrust at SLS condition. System and component design has been finished and their aerodynamic performances were verified by component tests and CFD analyses. A mixed flow compressor whose pressure ratio is 6, a reverse flow type combustion chamber and a non-cooled axial turbine are employed as the core jet-engine to satisfy the large thrust and compactness. The first system firing test is conducted in March of 2007 at Noshiro Testing Center of JAXA. At first, in order to verify the power matching of the compressor and turbine, "workshare configuration" tests are conducted. In these tests, the compressor and turbine are joined mechanically by a shaft but are separated from the point of view of the fluid. The air breathed and compressed by the compressor is discharged to the atmosphere and the air for combustion is supplied independently from an outer pressurized tank. This test uses gaseous hydrogen as a fuel and liquid nitrogen as a coolant of the precooler. The overall system firing test will be conducted in October of 2007, in which the final precooled turbojet configuration using the liquid hydrogen as a fuel and coolant. The S-engine will be used for a Mach 2 flight test to be conducted in 2008 by the Balloon-based Operation Vehicle (BOV) which is about 5 m in length, 0.55 m in diameter and 500 kg in weight. The vehicle is dropped from an altitude of 30-40 km by a high altitude balloon. After 40-second free-fall, the vehicle pulls up and S-engine operates for 30 seconds at about Mach 2. Most of measurement and control systems used for the ground tests are constructed to be used commonly for the BOV flight test. After the BOV flight tests, the composite material will be introduced to the S-engine to be operated under the hypersonic condition.