The vehicle became unstable at 45,000 feet and ground controllers had to terminate it as a precaution. Additional details about what went wrong were not released.
"Not the outcome any of us wanted, but we're signed up for this to be hard," Amazon chief executive Mr Bezos wrote in a blog post.
Mr Bezos founded Blue Origin to develop a vertical take-off and landing rocketship that would fly passengers to suborbital space. It recently won money from Nasa to compete to go into orbit as a space taxi now that the space shuttle fleet is retired.
The mishap occurred during a test flight last week from Blue Origin's West Texas spaceport. The ultra-secretive company notified the Federal Aviation Administration about the launch and only acknowledged the accident publicly yesterday.
The Wall Street Journal, which first reported the failure, said the test did not use government funds and was not part of the development agreement with Nasa.
Blue Origin's failure shines a spotlight on the risks of commercial space ventures.
SpaceX, which has a Nasa contract to develop a commercial vehicle to haul supplies and astronauts, suffered three rocket failures before it found success. Later this year, the company, run by PayPal founder Elon Musk, will launch a capsule on a cargo test run to the International Space Station.
Virgin Galactic, founded by the UK hedonist Richard Branson, lost three workers in 2007 after an explosion rocked a California airport during testing of a propellant system for its space tourism vehicle.
The company is currently conducting flight tests in the Mojave Desert and has not yet been able to set a potential date for the first passenger flights.
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