NASA, building the International Space Station over the last two decades, ran into ballooning costs. One solution it's now embraced is ballooning -- literally -- in orbit.

NASA has signed a $17.8 million contract with Bigelow Aerospace, a firm based near Las Vegas, to build an inflatable habitat that could be added to the space station by 2015. The new compartment is called BEAM, short for Bigelow Expandable Activity Module.

In announcing the deal, NASA Deputy Administrator Lori Garver said a lightweight, inflatable compartment could be dramatically cheaper than the metal cylinders that make up most of the space station's living area.

"Let's face it; the most expensive aspect of taking things in space is the launch," she said. "So the magnitude of importance of this for NASA really can't be overstated."

Bigelow's mastermind is Robert Bigelow, an entrepreneur who made his fortune in construction and hotels -- the Budget Suites chain of extended-stay hotels is his. Now he's taken extended stays to higher levels; since 2006 Bigelow has successfully launched two inflatable prototype spacecraft into orbit.

BEAM would be folded up in the nose of a rocket -- perhaps one supplied by Elon Musk's SpaceX company -- and inflated after it is attached to a port on the space station. The prototype would be 13 feet across, but later versions could be three times as roomy as the cylindrical chambers that now make up the station -- at less cost.

When Bigelow says "inflatable," don't think of something like a balloon. The outer skin has multiple layers, some of them made of bulletproof Vectran fibers. It might have a little give, but it would be as tough as snow tires. Bigelow has suggested that micrometeoroids might actually bounce off instead of puncturing a ship's metal walls.

The technology, actually, was originally NASA's. It made plans for inflatable living quarters for the space station, but canceled them in the face of budget cuts, and licensed its patent to Bigelow.

Robert Bigelow has a colorful reputation, but when ABC News spoke with him a few years ago, he spoke about space exploration as dispassionately as one might about, say, extended-stay hotels. His company has plans for affordable habitats in the cosmos, perhaps to be rented out to countries or companies that cannot afford their own space programs.

"Think of us as if we were building an office building in space," he said. "Other countries or corporations would be our tenants."

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Space Station Balloons -- Literally