If the company behind it raises the money it hopes to be able to relieve the Arctic winter, by reflecting the Sun's rays to high latitudes.
It is not a new idea. The first reflecting satellite, Znamya 1, was deployed in space for a day in 1993. A circular reflective fabric was unfurled. In small areas, it could provide many times the amount of light from the Moon.
A second prototype scheduled for November will be visible from cities around the Earth, including London, Brussels and Seattle. It will stay in space for just a day.
"With such a small mirror you could light two or three square kilometres of territory, even more," says Russian space expert Vladimir Semyenov.
Ultimately, the aim is to string hundreds of vast mirrors across the sky and banish darkness from parts of the Arctic Circle in winter. However, the Russian company is having difficulty raising the money for such a venture and there is international opposition.
'Space junk' criticised
If a large-scale system was ever built critics say the animals and plants in the Arctic could suffer.
They fear the extra light could disrupt the predictable cycle of light and darkness, the pattern that makes the natural world tick.
Astronomers are not happy either. They think the collection of little moons could light up the sky behind them and cause problems for research.
The scientists also fear accidents.
"Many space scientists will be annoyed because the lower orbits would be filled up with these little mirrors, in essence space junk, and the chance of your telecommunication satellite hitting one of these will be very high," says David Hughes from Sheffield University, UK.
The ultimate fear is that some companies will want to turn our tranquil night sky into something more like the Blackpool illuminations - complete with advertisements beamed from space.
However, many space experts say that such a system is unlikely to get off the ground in the foreseeable future.