The team were able to create molecules which could "smell"
Scientists say they are a step closer to developing a sensor which mimics the workings of the human nose.
The US researchers claim to have overcome one of the biggest hurdles - mass production of proteins called "olfactory receptors".
The average human has 100 million - and the MIT team say their technology could one day "sniff out" certain cancers which have distinctive chemical scents.
A UK expert welcomed the Proceedings of the National Academy of Sciences study.
Many researchers worldwide are working on "E-noses", which detect the same molecules that make up the scents we recognise.
These potentially have a wide range of uses, in industry and medicine.
However, while many rely on sensors constructed from artificial materials, the US researchers are working on a sensor with the biology of the human nose at its centre.
The human nose detects many different combinations of molecules, which are then interpreted by the brain.
It has around 300 varieties of olfactory receptors in the membrane surrounding cells lining the nasal passages, with each binding onto different kinds of molecule.
Efforts to manufacture artificial receptors in the numbers needed have previously failed, as their structure simply breaks down if they are removed from the specific environment found in the membrane and exposed to moisture.
But the MIT team, lead by Dr Liselotte Kaiser, was able to develop a detergent solution which protected them during the production process.
They then carried out basic tests which showed the manufactured proteins still had the ability to lock on to the molecules they needed to detect.
The researchers said that any device they developed could be used to aid diagnosis of diseases, such as bladder, skin and lung cancers which all can give off distinctive molecules.
Professor Krishna Persaud, who carries out "biosensor" research at the University of Manchester, praised the MIT breakthrough, but said there were still some important hurdles to overcome before the "dream" of a sensor based on the human nose could be realised.
He said that the manufactured proteins would now have to be arranged so they could function as they would in the cell membrane, and most importantly, a method of collecting their information, transmitting it, and processing it, would have to be developed.
He said: "This is excellent research, and brings this kind of biosensor a little closer.
"There are many, many applications for this kind of sensor - looking for low concentrations of pollutants in the environment, or testing food.
"A sensor based on the human nose is likely to work better than anything that uses an electronic sensor."