The current space arena has changed significantly since the 1950s, when outer space activities commenced. At the time of the adoption of the Outer Space Treaty (and the related General Assembly Resolutions), the outer space arena was largely dominated by the political interests of the two major space powers, the USA and the (then) USSR. Although states have remained the primary actors in regulating the use of outer space, the extent to which private companies would become involved in the exploration and use of space was not envisaged at the time of the conclusion of the space treaties. It is particularly the involvement of private space actors that complicates the traditional understanding of the prohibition on territorial sovereignty in outer space. With specific reference to the outer space boundary, the principle of the common heritage of humankind and property rights in outer space, this contribution aims to highlight some of the challenges to the prohibition of sovereignty in view of current developments in the arena of outer space. This analysis suggests that the blanket prohibition on sovereignty in outer space should be re-evaluated in order to keep up with the fast developing technological advancements in space exploration, and that clear legal rules be developed to provide legal certainty for all role players.