Reactive Systems, Inc. (RSI) was founded as a New York State S-corporation in 1999 by W. Rance Cleaveland II, Steven T. Sims, and Scott A. Smolka. The Company has offices in Falls Church, VA, a Washington, DC suburb and Nagoya, Japan.

RSI's technology base is derived from $10 million of federally funded research undertaken by the founders into tools and techniques for the mathematical specification and validation of reactive systems. A reactive system is intended to maintain an ongoing interaction with its environment in order to provide appropriate responses to stimuli the environment generates. Embedded software constitutes an important subclass of reactive systems. The federal agencies providing this funding include the National Science Foundation; the Army Research Office; the Air Force Office of Scientific Research; the Office of Naval Research; and DARPA.

In January 2000 the company was awarded a Phase I Small Business Innovation Research grant by the National Science Foundation (NSF). The Phase I grant funded a study involving the firm and the Ford Motor Company into the feasibility of applying RSI's analysis technology to the development of automotive embedded software. Based on the success of the project, the NSF awarded RSI and additional $500,000 in Phase II funding to develop and deploy the Company's Reactis embedded-software design automation tool suite.

In June 2002, RSI launched Reactis for Simulink and Stateflow. The tool suite consists of three main components: Reactis Tester, Reactis Simulator, and Reactis Validator. Tester generates comprehensive test suites from Simulink®/Stateflow® models. Simulator enables users to execute and fine-tune Tester-generated tests. Validator performs automated searches for violations of user-specified requirements. Shortly after the launch, the Company logged its first sales of the product. RSI's customer base has continued to grow steadily and now includes over forty major corporations from around the world from the automotive and aerospace industries.

RSI has been profitable since 2005.

In 2006, RSI was awarded a Small Business Innovation Research Grant by the Office of Naval Research and the Naval Research Laboratory. The project titled "A Software Hub for High Assurance Model-Driven Development and Analysis" investigated techniques to increase the level of interoperability among model-based design tools that use different modeling notations.

In early 2007, RSI opened is first foreign branch in Nagoya, Japan. In the fall of that year, the company released its second product Reactis for C Plugin. The package integrates seamlessly with Reactis to offer white-box analysis of S-Functions and custom C code called from Stateflow.