Researchers from the University of Strathclyde made 40 per cent of human skin cancer tumours disappear using the compound, called epigallocatechin gallate, in a laboratory study.
Green tea has long been suspected of having anti-cancer properties and the extract has been investigated before.
However, this is the first time researchers have managed to make it effective at shrinking tumours, the 'Telegraph' reported.
Previous attempts to capitalise on its cancer-fighting properties have failed because scientists used intravenous drips, which failed to deliver enough of the extract to the tumours themselves.
So, the Strathclyde team devised a "targeted delivery system", piggy-backing the extract on proteins that carry iron molecules, which cancer tumours hoover up.
The lab test on one type of human skin cancer showed 40 per cent of tumours disappeared after a month of treatment, while an additional 30 per cent shrank.
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"These are very encouraging results which we hope could pave the way for new and effective cancer treatments," said Dr Christine Dufes, a senior lecturer at the Strathclyde Institute of Pharmacy and Biomedical Sciences, who led the research.
"When we used our method, the green tea extract reduced the size of many of the tumours every day, in some cases removing them altogether.
"This research could open doors to new treatments for what is still one of the biggest killer diseases in many countries," Dufes said.
According to her, when the extract is administered intravenously, it goes everywhere in the body, so when it gets to the tumours it's too diluted.
"With the targeted delivery system, it's taken straight to the tumours without any effect on normal tissue," she explained.
The "ultimate objective" was a clinical trial in humans - but Dr Dufes said that was some way off.
The results have been published in the journal Nanomedicine.