Cosmic Raiders is a side-scrolling shoot 'em up similar to Defender. The player's space ship can move both left and right and there is also a radar showing the locations of enemies. The game takes place in the alien sector Larkin, where the player must defend a planet under attack while collecting energy sources from an evil alien race called the Larkins.
The objective of the game is to clear all the enemies and get the highest score possible. For every two bombs destroyed, an energy star that the player can collect will appear. By picking it up, the player's ship is energized with an invincible energy shield. Once all enemies have been cleared from one level, the game moves on to the next.
Before starting out, players can choose the number of players (1-4), number of lives (1-9) and the intensity of the game (0-9). Level 0 is the easiest one, where enemies do not get harder as the game goes on. Each player can have a different intensity level.