South Korean and US researchers said they had cloned a human embryo and extracted from it sought-after cells called embryonic stem cells.
The experiment, the first published report of cloned human stem cells, means so-called therapeutic cloning is no longer a theory but a reality.
Supporters of medical cloning say it can transform medicine, offering tailored and highly effective treatments for diseases ranging from Parkinson's to diabetes. They say it could eventually lead to grow-your-own organ transplants.
The stem cells taken from the tiny embryos, known as blastocysts, have the potential to develop into any kind of cell or tissue in the body.
"Our approach opens the door for the use of these specially developed cells in transplantation medicine," Woo Suk Hwang of Seoul National University in Korea, who led the study, said in a statement.
But critics say it involves destroying a human embryo, however tiny, and is thus unethical. The administration of US President George W. Bush and supporters in Congress are seeking to outlaw the technology both in the United States and worldwide.
Writing in the journal Science, Dr Hwang and colleagues said they created the clone using eggs and cumulus cells donated by Korean women.
Cumulus cells are found in the ovaries and in some species have been found to work especially well in cloning experiments.
Scientists have cloned sheep, cattle, mice and other species but have had trouble cloning a human being. Last year a Massachusetts company, Advanced Cell Technology, said it had created a human cloned embryo but it had not grown enough to become a source of stem cells.
The company is still trying but has not reported publicly on its progress.
Stem cells are found throughout the body and are a kind of master cell. But adult stem cells are difficult to find and to work with.
Many scientists believe blastocysts - stem cells taken from days-old embryos - have much greater potential. Each one, when grown correctly, can be directed to become any kind of cell or tissue at all.
Outside experts on cloning praised the work. "It is a very impressive study. It obviously represents a major medical milestone," said Dr Robert Lanza, who has helped lead cloning experiments at Advanced Cell Technology.
"I think it could help spur a medical revolution." Working with Hwang was Dr Jose Cibelli, formerly of Advanced Cell Technology and now a researcher at Michigan State University.
They used a process called nuclear transfer, which involves removing the nucleus from an egg cell and replacing it with the nucleus of a so-called adult cell - in this case a cumulus cells.
They cloned each woman using her own egg cell and her own cumulus cell, so the clones were 100 per cent copies of each woman.
They activated the egg cells using a chemical process, which started the eggs growing as if they had been fertilised by a sperm and got 30 embryos to grow to the blastocyst stage.
At this stage, approximately 100 cells, the stem cells should be removable.
They pulled stem cells from one of the blastocysts and managed to get them to grow into a variety of different cells including eye cells, muscle cells, bone and cartilage.
Dr Lanza said it is now important that laws be passed banning reproductive cloning - using cloning to create a human baby.
He noted that some researchers, notably Kentucky fertility expert Dr Panos Zavos, have been at least trying to clone a baby. "He's got the cookbook now. It's scary. We really need to move as soon as possible," Dr Lanza said.