The paper describes the development of a microsatellite attitude control system and verification of its functionality and performance by processor-in-the-loop (PIL) method. At NCKU, Taiwan, a 30 kg experimental satellite named CKUTEX is being developed. The role of the Attitude Determination and Control System (ADCS) is to provide attitude control functions including detumbling of the angular velocity, stabilization of the satellite, as well as estimation of orbit and attitude information for satellite operation. To fully develop and verify the attitude control system, a PIL simulation is developed. The simulation facility contains a dynamic simulator and real-time controller, as well as some interfacing circuitry. The dynamic simulator is capable of performing simulation of the space environment, orbit dynamic, attitude dynamic, and sensor/actuator models. The real-time controller is a realization of the embedded controller for attitude determination and control. The control actions of the CKUTEX are provided by magnetic torque rod while the attitude information is deduced from sensors including inertial measurement unit, digital sun sensors and magnetometers. Specifically, an NI-PXI platform is used to facilitate the simulation of the dynamics and a microchip processor is used to realize the real-time attitude determination and control functions. In the paper, the control requirements of the CKUTEX are briefly discussed. The PIL simulation facility is then described. Different simulation and test results are then provided to illustrate the capability of the PIL simulation in developing and verifying various functions and operations of the CKUTEX ADCS. The real-time performance requirement and computation throughput are then assessed to verify the embedded processor.