Scientists have transformed human skin cells into fully functioning liver cells with "extremely promising" therapeutic potential.
Transplanted into laboratory mice with liver failure, the cells matured and multiplied over a period of nine months.
In future they could form the basis of personalised treatments for patients who might otherwise need a liver transplant.
Earlier attempts to produce liver cells from artificially created stem cells have proved disappointing.
Generally, once implanted into existing liver tissue the cells have not tended to survive.
The new research involved a two-stage process of transforming skin cells in the laboratory before transplanting them.
First, the cells were genetically reprogrammed back to an intermediate "endoderm" stage of development using a cocktail of genes and chemical compounds.
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Next, a further set of genes and chemicals kick-started the transformation of the endoderm cells into functioning liver cells.
Unlike other scientists, the team deliberately avoided taking the skin cells right back to their embryonic roots.
Previous research has used induced pluripotent stem (iPS) cells - reprogrammed cells with the properties of embryonic stem cells.
"Earlier studies tried to reprogramme skin cells back into a pluripotent, stem cell-like state in order to then grow liver cells," said lead scientist Professor Sheng Ding, from the Gladstone Institutes in California.
"However, generating these so-called induced pluripotent stem cells, or iPS cells, and then transforming them into liver cells wasn't always resulting in complete transformation.
"So we thought that, rather than taking these skin cells all the way back to a pluripotent, stem cell-like state, perhaps we could take them to an intermediate phase."
The research, published in the latest online edition of the Nature journal, produced liver-like cells in the laboratory which were then transplanted into mice modified to mimic liver failure.
After two months, a boost in human liver protein levels was seen in the mice. Nine months later the cells were mature, functioning and continuing to grow.
Co-author Professor Holger Willenbring, from the University of California at San Francisco, said: "Many questions remain, but the fact that these cells can fully mature and grow for months post-transplantation is extremely promising.
"In the future, our technique could serve as an alternative for liver-failure patients who don't require full-organ replacement, or who don't have access to a transplant due to limited donor organ availability."