"We will be keeping a very close eye on it, although at the moment we would sound a note of caution as nothing has been published yet.
The technique involves transplanting insulin-producing islet cells from the pancreas of a healthy donor.
British surgeon James Shapiro says he has successfully carried out surgery on eight people who once had chronic diabetes.
Mr Shapiro, now based at the University of Alberta in Canada, told surgeons at a conference in Chicago that the patients were now living completely normal lives.
The British Diabetic Association said the new treatment was "very exciting" but could lead to massive demand from sufferers.
Spokesman Bill Hartnett said: "This looks like an extremely interesting development and would greatly improve the quality of life for those with diabetes."
The transplanted cells were extracted from the bodies of donors and kept alive and purified before being injected into the recipients through a main vein connected to the liver.
They were then carried into the bloodstream and "nested" in the liver, and despite not being in the patient's pancreas they still manage to produce insulin.
No injections
The eight patients, aged 29 to 53, were quickly able to live without injections after having previously been on up to 15 a day.
Mr Hartnett said: "There has been a lot of work done on transplanting but this looks like it might have more chance of being successful.
"We will be keeping a very close eye on it, although at the moment we would sound a note of caution as nothing has been published yet.
"No matter how well people control their diabetes with injections and diets, they can never have a perfect system. They also risk long-term health problems like heart disease, strokes and blindness.
"But no doubt there would be a great demand for a treatment like this, and it would put a strain on the NHS."
Future cloning techniques could overcome the problem of getting enough of the cells, Mr Shapiro told 3,800 delegates at the joint conference of the American Society of Transplant Surgeons and the American Society of Transplantation.
Patients would have to take anti-rejection drugs for life but a new product called Rapamune had shown few side effects in trials, he added.