A Kyoto University team used mice stem cells to create eggs, which were fertilised to produce baby mice.
Dr Renee Pera, of Stanford University in California, aims to create human sperm to use for reproduction within two years, and eggs within five years.
Infertility affects up to 15% of reproductive-aged couples worldwide.
"I know people think it's Frankenstein medicine, but I think it's not an imagined or lessened health problem - infertility affects your whole life," Dr Pera says.
"To have sex and have a baby would be a super simple decision, but not everybody can do it."
But using embryonic stem cells for research - as Dr Pera's lab at the Institute for Stem Cell Biology and Regenerative Medicine does - is controversial because the embryos are destroyed in order to use them.
Dr Pera's lab uses embryos left over from IVF treatments.
Stem cells have the potential to grow into any cell in the body. Creating eggs in a lab could become mainstream, much like IVF is viewed today.
Pregnancy age limits
If successful, the technology could significantly wind back the time on a woman's biological clock.
That is great news for many women who have put off having babies to pursue careers and for women who cannot get pregnant due to cancer treatments.
But it raises a slew of new ethical issues: who would decide when a woman is too old to become pregnant?