The capsules, which may available on the NHS within the next five years, could serve as an alternative to weight loss surgery.
The way they work is simple. Obese and overweight people are believed to ignore fullness cues, which are sent from the lower intestine to the brain.
The food capsules work to stimulate the lower intestine to make the body feel full, mimicking the effects of weight loss surgery.
Lead researcher and Professor of Enteric Neuroscience, Prof Ashley Blackshaw, explained in a statement: "At the moment, obese patients undergo gastric bypass surgery where they are essentially re-plumbed.
"Undigested food bypasses the small intestine and is shunted straight to the lower bowel where it causes the release of hormones which suppress the appetite and help with the release of insulin.
"That makes the patient feel full and stops even the hungriest individual from eating.
"We believe it's possible to trick the digestive system into behaving as if a bypass has taken place.
"This can be done by administering specific food supplements which release strong stimuli in the same area of the lower bowel.
"It's a bit like sending a special food parcel straight to the body's emergency exit, and when it gets there, all the alarms go off."
The past decade has seen a surge in weight loss surgery, which can cost between £3,000 and £15,000. At the moment around 8,000 people currently receiving the treatment, but that number could be set to rise.
At present weight loss surgery is given to patients on the NHS to those who are morbidly obese with a body mass index (BMI) score of over 40 or to those who have a BMI over 35 and who have another serious health condition - such as type 2 diabetes.
But now NICE is suggesting that people with a BMI score of 30 to 35 should be considered for an assessment for weight-loss operations on the NHS if they have been diagnosed within the last 10 years.
Under these guidelines Diabetes UK estimates 850,000 people could be eligible for surgery, but NICE expects it to be tens of thousands.
"Obesity rates have nearly doubled over the last 10 years and continue to rise, making obesity and overweight a major issue for the health service in the UK," said Professor Mark Baker, director of the Centre for Clinical Practice at Nice.
The food capsules could prove crucial in supporting the move by NICE, study lead Prof Blackshaw said of his team's findings: “It’s a totally novel idea, and we’re very excited at the results so far. We are hopeful that the treatment will be widely available in NHS hospitals in the next five years.”
Deborah Gilbert, chief executive of Bowel & Cancer Research, which funded the research, said: "This is leading edge science. Not only could Professor Blackshaw's work have a major impact on the growing problem of obesity and Type II diabetes, but with the link with weight and bowel cancer clearly established, it could have even wider implications."
The findings are published in GUT, the international journal of gastroenterology and hepatology.