High-time-resolution X-ray observations of compact objects provide direct access to strong-field gravity, black-hole masses and spins, and the equation of state of ultra-dense matter. LOFT, the Large Observatory for Xray Timing, is specifically designed to study the very rapid X-ray flux and spectral variability that directly probe the motion of matter down to distances very close to black holes and neutron stars. A 10-m2-class instrument in combination with good spectral resolution (<260 eV @ 6 keV) is required to exploit the relevant diagnostics, and has the potential of revolutionising the study of collapsed objects in our Galaxy and of the brightest supermassive black holes in active galactic nuclei. LOFT will carry two main instruments: a Large Area Detector (LAD), to be built at MSSL/UCL in collaboration with the Leicester Space Research Centre, and a Wide Field Monitor (WFM). The ground-breaking characteristic of the LAD (it will work in the energy range 2–30 keV) is a mass per unit surface in the range ~10 kg/m2, giving an effective area of ~10 m2 (@10 keV) at a reasonable weight—an improvement by ~20 over all predecessors. This will allow timing measurements of unprecedented sensitivity, providing the capability to measure the mass and radius of neutron stars with ~5% accuracy, or to reveal blobs orbiting close to the marginally stable orbit in active galactic nuclei. We summarise the characteristics of the LOFT instruments and give an overview of its expected capabilities.