Future small satellites will demand high-performance on-board electronics, requiring sophisticated approaches to heat rejection beyond simply increasing the radiator surface area. An interesting alternative approach is to increase the surface temperature of the radiator, using a heat pump. In this study, calculations were carried out to compute the theoretical radiator size reduction potential enacted by having a heat pump as part of a satellite’s thermal management system. The practical likelihood of a ‘typical’ vapor compression cycle (VCC) heat pump satisfying theoretical requirements was considered. In agreement with theoretical calculations, employing a ‘typical’ VCC heat pump could either increase or decrease the required radiator surface area. The choice of heat pump and its design is therefore crucial. A heat pump with a large temperature lift is essential for satellite radiator cooling applications, with the coefficient of performance (COP) being less important. Even with a low COP, such as 2.4, a ‘typical’ heat pump providing a large temperature lift, close to 60 °C, could reduce the satellite’s radiator surface area by a factor close to 1.4. This is a significant potential reduction. The decision on whether to pursue this approach compared to alternatives, such as deployable radiators, should consider the relative complexity, cost, weight, size, reliability, etc., of the two options. The focus of this study is VCC heat pumps; however, the results provide performance targets for less mature heat pump technologies, e.g., caloric devices, which could ultimately be applied in space.