The southern state's parliament approved the legislation late Thursday by 23 votes to 16 in an historic conscience vote that immediately sparked the ire of opponents of embryonic cloning, including anti-abortion groups.

The new law allows excess human embryos from in-vitro fertilization treatment to be used to create stems cells for research into fighting debilitating diseases such as Alzheimer's, Parkinson's and cystic fibrosis.

"We're talking about experimentation on human eggs, and some people do have concerns, but I weighed it up on a personal level as did most other MPs, and I came to the conclusion that I think this is a good way forward," said state Health Minister Bronwyn Pike.

Therapeutic cloning involves the harvesting of embryos for the purpose of producing stem cells.

The decision to legalize it could transform Victoria into a center of medical research, she said.

"It now allows us to continue our work with stem cells and potentially be world leaders in some of the work that will lead to discoveries in Alzheimer's and Parkinson's and other previously intractable diseases," she said.

The move came after Australia's parliament in December lifted a four-year-old ban on cloning of human embryos for stem cell research, a law that will only come into effect when each state has ratified it.

The states of New South Wales and Queensland are expected to follow Victoria's lead in votes on whether to legalize the practice shortly.

Countries such as Britain, China, South Korea, Japan, Belgium and Sweden all have legislation permitting carefully-regulated therapeutic cloning, but the practice is disputed and is the subject of fierce debate across the world.