A secondary school in Doncaster has been trying out a scheme where pupils' records are accessible via a microchip embedded in their school uniform.
The school says the microchip is not a tracking device
The device enables teachers to call up information about pupils, such as their attainment, as they enter a classroom.
Critics fear it could be a dangerous road to tread after the government lost personal details of 25 million people stored on computer discs this week.
The school's head teacher believes it is a useful tool for his staff.
The scheme sees a child's academic records being available through radio frequency identification (RFID) chips woven into the badges on their school jumpers.
It was devised by a teacher at Doncaster's Hungerhill School.
The chips send out a radio signal which enables their movements to be monitored as they pass scanners.
Ten pupils at the school have already been used in a pilot project.
Other institutions are now said to be trying out the technology.
But Margaret Morrissey from the National Confederation of Parent Teacher Associations said many parents would be concerned, especially after the government's loss of 25 million Child Benefit records.
She said: "We are going down a dangerous road to do something that we have managed to do for years without these microchips.
"I have a lot of questions about what the benefits are going to be.
"I would have hoped that schools could put procedures in place to keep track of kids without micro chipping them like they are cars on a race track."
Hungerhill's head teacher, Graham Wakeling, told parents in a letter that the micro-chip enabled students to be automatically registered as they entered the classroom.
Teachers with a handheld computer could access information about such things as their national curriculum levels, target grades and curriculum.
He stressed: "it is not a tracking device and cannot be used outside the school classroom".
The Department for Children, Schools and Families (DCSF) is keen to promote the use of electronic registration in schools because of its benefits in efficiently monitoring pupils' attendance.
But a DCSF spokesman said: "When we talk about electronic registration we mean teachers using networked computers to log attendance on a schools database this helps with safety, security and reducing truancy.
"This does not mean schools logging every detail of every pupil via covert means."
But the department said it was confident it had "very robust procedures" to protect personal data held within the department.
There is also concern about a new government database called ContactPoint, which will contain children's names and addresses and whether they are in contact with any social services.
It was recommended by the inquiry into the death of Victoria Climbie and is due to start operating next year.
"Given the obvious importance of ensuring that ContactPoint has extremely robust security measures in place, [Children's Secretary] Ed Balls ... asked for an independent assessment of its security procedures.
"We will announce who will conduct that assessment next week," the spokesman said.