A £2m project - hailed as the first in Europe - has been launched in Scotland to help find treatments for diseases like diabetes and leukaemia.
Human stem cells will be created from donated eggs and embryos
The Roslin Cells Centre will develop human stem cell lines to be sold worldwide for testing drugs and developing new medicines.
The stem cell lines will be created from donated eggs and embryos.
These will then be sold on a non-profit basis to academics and commercial companies.
The development has been unveiled by the Roslin Institute, Scottish Enterprise, Edinburgh University and the Scottish National Blood Transfusion Service.
Preparatory work on the project has been under way for about three months.
By selling stem cell lines without intellectual property rights, it should be easier and quicker to test and develop medicines.
Although some groups believe using human embryo stem cells is wrong, supporters argue the project will position Scotland as a world leader and attract more investment and employment in the area of medical science.
The centre will also act as the first step in a supply chain to support the development of the wider stem cell sector in Scotland, providing cells that can be used by academics, NHS Scotland and commercial companies.
Dr Paul De Sousa, project manager for the Roslin Cells Centre, said: "This approach will provide huge benefits to academics and companies already working in the stem cell field or seeking to enter it."
Neil Francis, deputy chief executive of Scottish Enterprise Edinburgh and Lothian, said: "As well as having huge potential to make significant breakthroughs in the treatment of some of the most debilitating diseases, the stem cell sector has the potential to become one of the key drivers of Scotland's knowledge economy.
"The Roslin Cells Centre is an important step in establishing a strong commercial sector based on Scotland's existing world class scientific strengths."
Professor Harry Griffin, director of the Roslin Institute, added: "This new initiative represents a key step in the drive to deliver safe and effective stem cell therapies."
Dr Angela Wilson, director of research at Diabetes UK said the investment would hopefully move things closer to finding new treatments for people with diabetes.
She added: "However, there are still significant obstacles that will need to be overcome before this is possible. Any transplanted cells will need to behave like our own body's cells producing insulin in response to changes in blood glucose levels."
The Church of Scotland said it supported the move.
Dr Donald Bruce, director of the Kirk's ethics and technology unit, said: "Broadly speaking we agree with this centre and making stem cells that are of therapeutic quality available and that it's being done on a not-for-profit basis."
However, he stressed the need for ethical control and for couples donating embryos or eggs to be kept fully informed.
A spokesman for the Roman Catholic Church in Scotland said it believed human beings should "never be used as a means to an end".
He added: "The use of persons at the embryo stage is not acceptable for it violates their individual human rights, integrity and dignity.
"Furthermore, clear research indicates the successful and moral use of stems cells found in adults or placenta. Humanity is not here to serve science but science is here to serve humanity."