A sticking plaster concealing a tiny pump could provide relief for patients who need regular medication.
A tiny pump can be contained in a special plaster
The plaster could be worn on the skin while treatments such as insulin for diabetics are released through the device.
The micro-pump will allow patients to carry and receive a three-day supply of insulin inconspicuously on any part of their body.
It could also be used by people receiving fertility treatments.
About 1.4 million people in the UK have diabetes. A quarter of them have type 1 diabetes which requires insulin injections usually two to four times a day.
Some insulin pumps already exist but they are larger and the tubing can prove cumbersome. They are worn on a belt like a pager.
The National Endowment for Science, Technology and the Arts (NESTA) has put £120,000 into developing the new technology.
It is being developed by Starbridge Systems, a company based in Swansea.
The company's chief executive Joseph Cefai said: "It will release diabetics from the need to use syringes and needles, enabling them to continuously infuse insulin."
He said the elderly would find it particularly useful and it would allow people to eat, sleep and exercise normally.
The NESTA grant will allow a prototype of the device to be developed. It is hoped it will be available to diabetics in five years.
Emma Bunn at Diabetes UK said: "This invention is in its early stages. It may eventually provide a smaller alternative to current insulin pumps, which are already a treatment option for some people with diabetes.
"Diabetes UK welcomes any safe, effective device which makes treating diabetes easier.
"The more treatment options people with diabetes have, the better."
Rhodri Morgan, Welsh First Minister, described it as an "exciting, high-tech" project.