A trial of the vehicle, named Selenium, took place in Milton Keyes on pavements around the town's train station and business district.
The technology behind Selenium was developed by researchers at Oxford University, supported by funding from the Engineering and Physical Sciences Research Council (EPSRC).
Oxford University spinout business Oxbotica is currently in the process of trying to commercialise Selenium.
Selenium uses cameras that take pictures 20 times a second in "very high resolution", together with fast-spinning lasers "to see what's in front of it and what's around it", according to professor Paul Newman of Oxford Robotics Institute at Oxford University.
The Transport Systems Catapult (TSC) facilitated the public testing of the vehicle in Milton Keynes, which was undertaken following safety planning and work on establishing the underlying regulatory environment.
"This public demonstration represents a major milestone for autonomous vehicles in the UK and the culmination of an extensive project involving UK companies and experts," Neil Fulton, programme director at the TSC, said: "Oxford University's technology will go on to power automated vehicles around the world, and the LUTZ Pathfinder project will now feed into a much wider programme of autonomous trials across the UK."
"Driverless vehicles are coming to Britain, and what we have demonstrated today is a huge step on that journey," he said.
Graeme Smith, Oxbotica chief executive, said: "The TSC's Lutz Pathfinder project is a great example of Oxbotica's autonomy software leading the way for self-driving vehicles here in the UK. This is a landmark step towards bringing self-driving vehicles to the streets of the UK and the world. Our unique Selenium software gives vehicles the next-generation level of intelligence to safely operate in pedestrianised urban environments."
A recent report by Morgan Stanley and Boston Consulting Global (BCG) warned that advances in car technology is likely to push down the value of the global motor insurance market over the next quarter of a century.
Earlier this year the UK government said it plans a "rolling programme of regulatory reform" to support the adoption of autonomous vehicles. It has identified changes to motor insurance and road traffic laws as among its initial priorities which were outlined in a consultation published by the government's Centre for Connected and Autonomous Vehicles (C-CAV). The government has already established a code of practice for testing driverless cars in the UK.
A UK parliamentary inquiry is currently looking into the potential uses and benefits of autonomous vehicles.
An industry survey carried out by Pinsent Masons, the law firm behind Out-Law.com, found that nearly 80% of respondents believe the UK government needs to change current laws either urgently or very urgently to facilitate driverless cars testing and use.
An earlier report published by Pinsent Masons in April identified outdated road traffic laws, complexities in patent licensing and restrictive data privacy rules as among the obstacles to the testing and adoption of driverless and connected vehicles.