Men with insulin-dependent diabetes may one day have their condition treated using cells from their testicles.
Scientists have succeeded in transforming sperm stem cells into the pancreatic cells that generate insulin.
Tests on diabetic mice showed the beta islet cells could produce enough of the vital hormone to start reversing their disease.
Researchers hope in future it may be possible to treat men with Type-1 diabetes with islet cells grown from their own spermatogonial stem cells (SSCs).
Because the therapeutic cells would originate from their own bodies, they would not be rejected by the immune system.
Egg stem cells may have the same potential to change into islet cells, which could benefit female patients, the scientists believe.
However, a leading charity warned against raising premature hopes of a cure.
Type-1 diabetes, which affects about 300,000 people in the UK, is an auto-immune disease in which insulin-producing cells in the pancreas are gradually destroyed.
Doctors have investigated replacing the lost cells with transplants from deceased patients, but there are few suitable donors and rejection is a serious problem.
Experiments with "induced pluripotent" stem (IPS) cells – ordinary cells reprogrammed to have the properties of stem cells from embryos – have also met with obstacles. The technique produces tumours in mice and involves inserting genes, which can be harmful.
Instead of IPS cells, the new research focused on SSCs, early precursors of sperm cells found in the testes. They come ready-equipped with the genes necessary for them to morph into "pluripotent" cells – cells capable of launching themselves on many different development paths.
A US team led by Ian Gallicano, from Georgetown University Medical Centre in Washington DC, took the SSCs from the testes of dead human donors.
One gram of tissue was used to grow about a million stem cells with the biological characteristics of beta islet cells. These were then transplanted into the backs of immune-deficient diabetic mice, where they secreted insulin.
In about a week the animals' blood glucose levels had been reduced, showing that enough insulin was being produced to tackle the excess sugar load characteristic of diabetes.
"No stem cells, adult or embryonic, have been induced to secrete enough insulin yet to cure diabetes in humans, but we know SSCs have the potential to do what we want them to do, and we know how to improve their yield," said Dr Gallicano.
After SSCs are removed from the testes they start to transform into the three embryonic "germ layers" that give rise to all the body's tissues, the scientists discovered.
"We found that once you take these cells out of the testes niche, they get confused and will form all three germ layers within several weeks," Dr Gallicano added. "These are true pluripotent stem cells."
The findings were presented today at the annual meeting of the American Society of Cell Biology in Philadelphia.
While the effects lasted only a week, more recent work by the team has shown that the insulin yield can be greatly increased.
Dr Gallicano believes it may be possible to transform immature oocytes, or female eggs, the same way.
British stem cell scientist Prof Chris Mason, chairman of regenerative medicine bioprocessing at University College London, said: "Yet again, a world-class team of scientists has suggested another novel cell-based therapy for diabetes. The question is how to turn such great discoveries into safe, effective cures for people with diabetes."