The Atari 5200 was launched in 1982 as the Atari 5200 SuperSystem. It was meant to be a higher end replacement of the Atari Video Computer System (VCS). The VCS was renamed to Atari 2600 at the launch of the 5200. The 5200 was intended to compete with the Intellivision of Mattel, but ended up competing with the ColecoVision. The ColecoVision came out with the first home edition of the game Donkey Kong, while the Atari 5200 came out with a version of the game Super Breakout. This game had already appeared for the Atari 8-bit family of computers, on which the 5200s hardware had been built.

The CPU, graphics and sound chips of the Atari 5200 are almost identical to the ones used in the Atari 8-bit line of home ccomputers. However, due to differences in firmware the software is not directly compatible between the systems.

The 5200 controllers were different to say the least. They not only had a joystick, and action buttons, but they offered a numeric keypad along with start, pause, and reset buttons. The joystick was a 360 degree non-centering one, and endured some criticism by gamers.

Ultimately the 5200 was discontinued only 2 years after its launch. The system was not backwards compatible with the Atari 2600, and the improvements on the hardware were not enough to be a serious competitor in the market. Were the Atari 2600 sold more than 30 million units, the 5200 barely made it to 1 million.

Internally the Atari 5200 resembles, but is not identical to the 8-bit computers. Internally the designers did use the ANTIC, POKEY and GTIA processors, but there are some major differences:

1. 2KB ROM vs the 10K ROM of the Atari 8-bit line.
2. GTIA and POKEY hardware registers were mapped to different locations in the memory map.
3. Some registers were re-purposed, losing compatibility
4. The hardware sees the joysticks as paddles, requiring a different input handling of joystick input signal

Software could be ported to the 5200, but only if it used non-computer specific features. But in practice software could be developed on the 8-bit computers and without too much trouble be ported to the 5200.

ANTIC is a microprocessor which processes a sequence of instructions known as a display list. An instruction adds one row of the specified graphics mode to the display. Each mode varies based on whether it represents text or a bitmap, the resolution and number of colors, and its vertical height in scan lines. An instruction also indicates if it contains an interrupt, if fine scrolling is enabled, and optionally where to fetch the display data from memory.

Since each row can be specified individually, the programmer can create displays containing different text or bitmapped graphics modes on one screen, where the data can be fetched from arbitrary, non-sequential memory addresses.

ANTIC reads this display list and the display data using DMA (Direct Memory Access), then translates the result into a pixel data stream representing the playfield text and graphics. This stream then passes to GTIA which applies the playfield colors and incorporates Player/Missile graphics (sprites) for final output to a TV or composite monitor. Once the display list is set-up, the display is generated without any CPU intervention.

There are 15 character and bitmap modes. In low-resolution modes, 2 or 4 colors per display line can be set. In high-resolution mode, one color can be set per line, but the luminance values of the foreground and background can be adjusted. High resolution bitmap mode (320x192 graphics) produces NTSC artifacts which are "tinted" depending on the color values; it was normally impossible to get color with this mode on PAL machines.

For text modes, the character set data is pointed to by a register. It defaults to an address in ROM, but if pointed to RAM then a programmer can create custom characters. Depending on the text mode, this data can be on any 1K or 512 byte boundary. Additional register controls allow flipping all characters upside down and toggling inverse video.

The Color Television Interface Adaptor (CTIA) is the graphics chip originally used in the Atari 400 and 800. It is the successor to the TIA chip of the 1977 Atari VCS. According to Joe Decuir, George McLeod designed the CTIA in 1977. It was replaced with the Graphic Television Interface Adaptor (GTIA) in later revisions of the 400 and 800 and all later 8-bit models. GTIA, also designed by McLeod, adds three new playfield graphics modes to ANTIC which allow more colors than previously available.

The CTIA/GTIA receives Playfield graphics information from ANTIC and applies colors to the pixels from a 128 or 256 color palette depending on the color interpretation mode in effect. CTIA/GTIA also controls Player/Missile Graphics (sprites) including collision detection between players, missiles, and the playfield; display priority for objects; and color/luminance control of all displayed objects. CTIA/GTIA outputs separate digital luminance and chroma signals, which are mixed to form an analog composite video signal.

CTIA/GTIA also reads the joystick triggers and the console keys Option, Select, Start, and operating the keyboard speaker in the Atari 400/800. In later computer models the audio output for the keyboard speaker is mixed with the audio out for transmission to the TV/video monitor.

The third custom support chip, named POKEY, is responsible for reading the keyboard, generating sound and serial communications (in conjunction with the PIA chip (Peripheral Interface Adapter, 6520) commands and IRQs, plus controlling the 4 joystick movements on 400/800 and later RAM banks and/or ROM(OS/BASIC/Self-test) enables for XL/XE lines). It also provides timers, a random number generator (for generating acoustic noise as well as random numbers), and maskable interrupts. POKEY has four semi-independent audio channels, each with its own frequency, noise and volume control. Each 8-bit channel has its own audio control register which select the noise content and volume. For higher sound frequency resolution (quality), two of the audio channels can be combined for more accurate sound (frequency can be defined with 16-bit value instead of usual 8-bit). The name POKEY comes from the words "POtentiometer" and "KEYboard", which are two of the I/O devices that POKEY interfaces with (the potentiometer is the mechanism used by the paddle). The POKEY chip—as well as its dual- and quad-core versions—was used in many Atari coin-op arcade machines of the 1980s, including Centipede and Millipede, Missile Command, Asteroids Deluxe, Major Havoc, and Return of the Jedi.