This research paper presents the progress made in the Cyber Physical Test System (CPTS) project, which aims to provide a cost-effective and secure automatic test equipment (ATE) for small and medium-sized enterprises (SMEs) in the embedded systems industry. CPTS allows outsourced testing while protecting the intellectual property (IP) of the SMEs. This paper discusses the development of low-cost main device hardware, the establishment of connectivity between the main device hardware and the test cloud, and the implementation of test execution plans for test program sets (TPSs). Furthermore, it explores typical industrial application scenarios for the CPTS, highlighting its benefits and advantages in industrial settings.