The team leader, Professor David Mooney, told the BBC they may be ready to perform nipple transplants this year.

The researchers in Boston, Massachusetts, said within five years they hope to be able to grow fully functional breasts.

Their work could revolutionise both treatments for women who have suffered breast cancer and the cosmetic breast augmentation industry.

Not only are the scientists optimistic about being able to engineer breast, they expect to recreate the process of lactation, which allows the breast to produce milk.

The commercially-funded project is run by Reprogenesis in association with a number of university research groups.

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Shawn Stovall, a spokesman for the Boston company, told The Sunday Times it expected a large market for the product.

"Our initial intention is to provide an option for breast cancer patients, but the method could be used for cosmetic reconstructions and it has generated a lot of interest," he said.

Eventually, the technique could replace silicone implants, which have potentially dangerous side-effects.

The researchers plan to hold the first trials where the engineered nipples are transplanted on to women's breasts within the year.

The nipples are grown over around two weeks from fat and blood vessel cells taken from the upper leg.