This paper describes a trade-off procedure and accompanying criteria for payload selection in university small satellite projects. The procedure is applied in the next Delfi nanosatellite project which is part of the Delfi nanosatellite development program of the Delft University of Technology. The programme objectives are described and various criteria are analyzed to fulfil the objectives. Selection criteria related to the educational objectives are more important than technological and functional objectives. It is shown that educational objectives even drive technological and functional objectives. Cooperation between universities and companies is important in terms of the supply of services in kind. A related criterion based on experience is described. The trade-off results are presented including an overview of the selected payloads. This paper concludes with the preliminary mission definition for the next Delfi nanosatellite mission targeted for launch in 2010.