The Palomar Transient Factory (PTF) is a fully-automated, wide-field survey aimed at a systematic exploration of the optical transient sky. The transient survey is performed using a new 8.1 square degree camera installed on the 48 inch Samuel Oschin telescope at Palomar Observatory; colors and light curves for detected transients are obtained with the automated Palomar 60 inch telescope. PTF uses 80% of the 1.2 m and 50% of the 1.5 m telescope time. With an exposure of 60 s the survey reaches a depth of m$_g$^′$$ ≈ 21.3 and m$_R$ ≈ 20.6 (5σ, median seeing). Four major experiments are planned for the five-year project: (1) a 5 day cadence supernova search; (2) a rapid transient search with cadences between 90 s and 1 day (3) a search for eclipsing binaries and transiting planets in Orion; and (4) a 3π sr deep H-alpha survey. PTF provides automatic, real-time transient classification and follow-up, as well as a database including every source detected in each frame. This paper summarizes the PTF project, including several months of on-sky performance tests of the new survey camera, the observing plans, and the data reduction strategy. We conclude by detailing the first 51 PTF optical transient detections, found in commissioning data.