To defend against the aliens, a secret organisation called SHADO (Supreme Headquarters Alien Defence Organisation) is established. Operating behind the cover of the Harlington-Straker Studios in England, SHADO is headed by Commander Edward Straker (played by Ed Bishop), a former United States Air Force Colonel and Astronaut who poses as the studio's chief executive.
In reality, this was a clever cost-saving move by the producers – the studio was the actual studio where the series was being filmed, originally the MGM British Studios, later Pinewood Srudios, although the Harlington-Straker studio office block seen throughout the series was actually Neptune House – a building at the former British National Studios, in Borehamwood, that were owned by ATV. Pinewood's studio buildings and streetscapes were used extensively in later episodes, particularly "Timelash" and "Mindbender," the latter featuring scenes that actually showed the behind-the-scenes workings of the UFO sets when Straker briefly finds himself hallucinating that he is an actor on a TV series and all his SHADO colleagues are likewise actors.
Typical of Anderson productions, the studio-as-cover idea was both practical and cost-effective for the production and provided a ready-made vehicle for the viewer's suspension of disbelief It removed the need to build an expensive exterior set for the SHADO base and combined the all-important "secret" cover (concealment and secrecy are always central themes in Anderson dramas) with the trademark ring of at least nominal plausibility. A studio was a business where unusual events and routines would not be remarkable or even noticed. Comings and goings at odd times, the movement of vehicles, equipment, people and material would not excite undue interest and could easily be explained away as "sets," "props," or "extras."
The show's concept was unusually dark for its time: the basic premise was that alien invaders were abducting humans to use as involuntary organ transplant donors. A later episode, "The Cat With Ten Lives," contains a sinister plot point which suggests that the UFO pilots are not humanoid aliens at all, but are in fact human abductees under the control of the alien intelligences, suggesting that, as in Captain Scarlet,the aliens, in the dialog of Dr. Jackson, "may have no physical being at all and therefore need a container, a vehicle, our bodies."
The show also featured realistic, believable relationships between the human characters to a far greater extent than usual in a typical science fiction series, showing the clear influence of American programmes like The Twilight Zone and Star Trek and British action series such as Danger Man. One early episode, "Computer Affair," strongly hinted at an interracial romance between two continuing characters--something that was uncommon on British TV in those days, while others showed the heroes making mistakes with sometimes fatal consequences. Furthermore, relatively few episodes of the series actually had happy or (for the characters) satisfying endings.
The episode "Confetti Check A-OK" is almost entirely devoted to the breakdown of Straker's marriage under the strain of maintaining the secrecy of the classified nature of his duties. Another, "A Question Of Priorities," takes this exploration further, and hinges on Straker having to make an agonising life-or-death choice: divert an aircraft to deliver life-saving medical supplies to his critically injured son, or allow the aircraft to continue on its mission to attempt a last-chance intercept against an incoming UFO. Two key images from "A Question Of Priorities" – Straker's son being struck down and his ex-wife declaring she never wants to see him again – are repeated in flashback in two subsequent episodes, "Sub Smash" and "Mindbender," suggesting that Straker remains haunted by these unresolved emotional issues.
Another episode, "The Square Triangle," centres on a woman and her lover who plan to murder her husband. When they accidentally kill an alien from a downed UFO instead, SHADO intervenes and doses the guilty pair with amnesia drugs (decades ahead of a similar story device in Men In Black, and one deployed for similar reasons). Straker realises, however, that the drugs will not affect their basic motivation and, worse, he cannot reveal the truth to local legal authorities. The end credits of this episode are run over a scene set in the near future, showing the woman visiting her husband's grave and then walking to meet her lover.
Some critics complained that the emphasis on down-to-earth relationships weakened the show's science fiction premise and were also a means of saving money on special effects. The money-saving argument might have been true to a limited extent, but the Andersons made a virtue of necessity. They had always hoped to direct live action TV drama, and although the marionette shows helped them develop impressive skills in effects and scripting, they had always considered them as essentially being a way of keeping in work and earning money while they tried to break into "real" TV drama. Others countered that the characters were more well rounded than in other science fiction shows and that science fiction concepts and special effects in themselves did not preclude realistic action and interaction and believable, emotionally engaging plots. Ultimately, the mix of dark human drama with traditional science fiction adventure is probably the reason for UFO's enduring cult popularity and what sets it apart from the rest of TV SF series. For example, the time-freeze plot of the episode "Timelash" is similar to The Outer Limits episode "The Premonition." But UFO adds a drama twist: Straker repeatedly injects a drug (X 50 stimulant) to remain awake during the time freeze, which results in Straker being hospitalised in SHADO's medical centre. The ending not only shows him lying in bed recovering from the harmful effects of drug use, but has a subtext that the plot of the episode may, in fact, have been a drug-induced delusion. This SF and dark drama mix is why UFO cuts deeper than most similar series.