The Air Force is firming up its plans to deploy modified Boeing 747s with a laser that could shoot down ballistic missiles in flight. The laser doesn't incinerate the missile; it just uses its own fragility in intense flight conditions and its onboard explosives to cause it to blow itself up.
The Air Force wants 7 planes at a cost of $1.5 billion each, for a total price tag of about $10.5 billion. The plan has passed preliminary tests with lower energy lasers, and would like to test it against a real missile in 2009, although a 2011 test date seems more likely given budgetary constraints.
The down side of the program is that you need to know who is going to fire the missile at what place and time, within a fairly narrow set of constraints, for it to work. Ballistic missiles can clear 4,000 miles in 30 minutes, which means for all practical purposes that the laser defense is useless unless the plane is in the air, within a thousand mile or so of the launch site, when the enemy missile is launched. A sustained twenty four hour patrol regime isn't cheap when you are using $1.5 billion planes with touchy chemical and optical components.
Also, while the system would work against isolated missile attack from a terrorist or rogue state, it would be useless against a simultaneous barrage of missiles -- it would provide virtually no defense against a large scale Russian nuclear attack, for example. Indeed, the same caveat can be placed on all current ballistic missile defense work. Stopping a North Korea with a handful of missiles may be possible, stopping a major nuclear power is vaporware, and likely to remain so for the foreseeable future.
Since it is harder to keep a 747 on station 24 hours a day than it would be to, for instance, keep a proposed 25,000 ton anti-ballistic missile cruiser afloat in a high risk of missile launch area, the Navy has a continuing edge in anti-ballistic missile defense. The other Air Force project, a land based interceptor missiles progam, has been dismal failure so far.
On the other hand, the notion of a defensive laser gun that causes fragile airborne objective full of explosive materials to blow up before hitting their target has a wide variety of other potential applications. Experimental projects are looking at similar concepts for point defense against anti-ship missiles, mortar rounds, tank and artillery shells, rocket propelled grenades, and rocket attacks such as those that characterized the Israeli-Lebanon war. They could also be used as anti-satellite weapons, and as a form of point defense for satellites against projectiles aimed at them.
Lasers also show promise as anti-aircraft weapons (with a focus on pilot vision, avionics and igniting a plane's fuel supply and ordinance), although it isn't clear that our soon to be completed fleet of F-22s doesn't already have that problem well in hand-- wouldn't 7 more F-22s be superior to 1 new unproven laser plane that would be toast if it was the victim of a surprise attack?
Similarly, one can imagine a laser plane being used to destroy ground based missile launchers, tanker trucks, fuel depots and ammunition depots, when there is no ballistic missile threat to worry about -- although in this last case, we already have comparable good solutions to the problem with relic planes like the A-10 and the B-52, ground based armor and artillery, the AH-64 Apache, and more. But, a $1.5 billion laser plane is an expensive solution to that problem. But, it could probably do the job if other military resources were tied up.
The big virtue of a laser over a projectile for these jobs is that a laser can hit the target as fast as you can see it, which makes them ideal for fast moving targets. The downside is that lasers using current technology as sufficient wattage are quite big and bulky, and also mostly rely on horribly polluting chemicals. But, because of the immense power of the laser need to do damage in its own right, laser weapons are likely to be a "match" that sets off secondary explosions, rather than a powerful destructive weapon in its own right, for many decades to come, at least. They are likely to be virtually useless against infantry or a tank, for example.