The move, which comes after five years of research, is seen as the penultimate stage in the endeavour to create an artificial life form based entirely on a man-made DNA genome - something which has tantalized scientists and sci-fi writers for years.

'Through dedicated teamwork we have shown that building large genomes is now feasible and scalable so that important applications such as biofuels can be developed,' said Hamilton Smith, from the J.Craig Venter Institute, in the study published in Science.

The research has been carried out at the laboratories of the controversial celebrity US scientist Craig Venter, who has hailed artificial life forms as a potential remedy to illness and global warming.

However, the prospect of engineering artificial life forms is highly controversial and arouses heated debate over the ethics and its potential ramifications.

It is one of the Holy Grails of science, but also one that stirs deep fears as foreseen in Aldous Huxley's 1932 novel 'Brave New World' in which natural human reproduction is eschewed in favour of babies grown artificially in laboratories.

Dr Venter said in a statement: 'This extraordinary accomplishment is a technological marvel that was only made possible because of the unique and accomplished ... team.'

His researchers had 'dedicated the last several years to designing and perfecting new methods and techniques that we believe will become widely used to advance the field of synthetic genomics,' he added.

Lead author Dan Gibson said the team had completed the second step in a three-step process to create a synthetic organism.

In the final stage of their research which they are already working on, the Maryland-based team will attempt to create a bacteria based purely on the synthetic genome sequence of the Mycoplasma genitalium bacteria.

The bacteria, which causes certain sexually transmitted diseases, has one of the least complex DNA structures of any life form, composed of just 580 genes.

In contrast, the human genome has some 30,000.

The chromosome which Venter and his team has created is known as Mycoplasma laboratorium and, in the final step of the process, will be transplanted into a living cell where it should 'take control', effectively becoming a new life form.

'When we started this work several years ago, we knew it was going to be difficult because we were treading into unknown territory,' said Smith.

But other scientists remain cautious, saying Dr Venter and his team are still a long way from being able to create artificial life.

And ETC, a Canadian watchdog group that uncovered Venter's patent application for M. laboratorium, worries about accountability.

'Dr Venter is claiming bragging rights to the world's longest length of synthetic DNA, but size isn't everything. The important question is not 'how long?', but 'how wise?''said Jim Thomas from ETC.

'While synthetic biology is speeding ahead in the lab and in the marketplace, societal debate and regulatory oversight is stalled, and there has been no meaningful or inclusive discussion on how to govern synthetic biology in a safe and just way.'

Eckard Wimmer, professor of molecular biology at New York University, said it was clear from Venter's study that the team had not yet created artificial life.

He said he was left with 'the unpleasant feeling whether or not the synthetic DNA was indeed proper and able for biological function'.

His fears were echoed by Helen Wallace, a biologist and spokeswoman for GeneWatch UK, who said that while Venter's team has managed a technical feat, it is some way from being artificial life.

'Dr Venter is not God ... He's a long way from creating life,' she said.

'It's a type of genetic engineering which would allow people to make much bigger genetic changes, which means that in the future you could create organisms with new gene sequences.' -- AFP