Astronomical space missions require stable and fast target pointing to achieve their science objectives. To obtain high pointing stability, a Fine Guidance System (FGS) mechanism is normally used to provide fine pointing control. In this project, we analyse possible implementations of an FGS that uses piezoelectric actuators. This would not only allow for stable pointing but also allow for fast and reliable FGS operation. An optical setup was designed and built to test the proposed mechanism. Using a PID control loop, stability of up to 0.2 pixels on the focal plane was achieved. Considerable drifts that were observed without the FGS mechanism were eliminated using this control loop. The mechanical and thermal characteristics of the piezoelectric FGS mechanism were studied using finite element analysis to better characterise and optimise it. A software simulator was also produced to allow us to study the performance of centroid determination and the effects of an FGS mechanism in various situations. We conclude that a reliable and fast operating FGS can be implemented using piezoelectric actuators, allowing future astronomy missions to reach a stability of 5–10 milliarcseconds at a correction rate of up to a few hundred hertz. This stability, together with other advantages such as the mechanical simplicity of the system would make it ideal for space satellites such as the Twinkle satellite. It would also be an ideal system for many other low Earth orbit satellites, where many orbital disturbances need to be managed.