A £16.5m stem cell research centre is being opened at Cambridge University.
The national Stem Cell Institute would put Britain in the front line of stem cell medicine.
The decision to build it follows the establishment of a national stem cell bank in Hertfordshire for future use in transplant medicine.
The institute is being paid for by a £9.3m university grant, a £1.5m Medical Research Council grant, a £2.8m private endowment and smaller donations.
The new centre would bring together scientists from different disciplines to develop treatments for currently incurable diseases.
It would aim to accelerate work on stem cells and their use in medicine.
Scientists believe stem cells - master cells that have the potential turn into every kind of human tissue - could be used to replace diseased cells in people suffering from spinal cord injury, diabetes, Parkinson's disease and other currently incurable ailments.
Professor of regenerative medicine at the University of Cambridge, Roger Pedersen, who would be the centre's director, said that research on stem cells was likely to lead to innovative cell transplantation therapies.
"Stem cell research will also have a major impact on understanding the development and regenerative capacity of the body as a whole," he said.
"Stem cell research has a profound potential for treating currently debilitating diseases, such late-onset conditions as Parkinson's, Alzheimer's, diabetes, cancers, heart and blood diseases, and thus has the capacity to markedly improve the quality of life."
A spokesperson for the ProLife Party, which is opposed to research on stem cells from embryos, welcomed the establishment of a national centre but said its work should be limited solely to research on adult stem cells.
"By all means let's organise institutes of this kind and endow them with useful money, but under no circumstances should they go near human embryos.
"There are no known cures from embryonic stem cells - there are known cures from adult stem cells."
The new centre will eventually house up to 150 scientists.