An unmanned air vehicle (UAV), ''Banshee'', was first flown into the air, which was hit by the MRSAM.
The DRDO has jointly developed the missile in collaboration with Israel Aerospace Industries.
The MRSAM has been manufactured by Bharat Dynamics Ltd.
After its induction into the Indian army, the missile will significantly enhance the combat effectiveness of the defence forces, they said.
The entire mission trajectory from the launch to plunging into the sea was monitored by various radars and electro-optico instruments, the sources said.
Prior to the test, Balasore district administration in consultation with DRDO temporarily evacuated 8,100 people residing within 2.5 km radius of the launch pad to the nearest shelter centres on Wednesday morning, a revenue department official said.
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