Among the actual trends that will affect society in the coming years, autonomous driving stands out as having the potential to disruptively change the automotive industry as we know it today. As a consequence, this will also highly impact the semiconductor industry and open new market opportunities, since semiconductors play an indispensable role as enablers for automated vehicles. Fully automated driving has been identified as one major enabler to master the Grand Societal Challenges of safe, clean, and efficient mobility. For this, fail-operational behavior is essential in the sense, plan, and act stages of the automation chain in order to handle safety-critical situations by its own, which currently is not reached with state-of-the-art approaches also due to missing reliable environment perception and sensor fusion. PRYSTINE, which was the highest ranked ECSEL project proposal in 2017, will realize Fail-operational Urban Surround perceptION (FUSION) which is based on robust Radar and LiDAR sensor fusion and control functions in order to enable safe automated driving in urban and rural environments. Furthermore, PRYSTINE will strengthen and extend traditional core competencies of the European industry, research organizations, and universities in smart mobility and in particular in the electronic component and systems and cyber-physical systems domain.