SCIENTISTS in Edinburgh who pioneered the production of Dolly the sheep, the world's first cloned animal, yesterday revealed another first - a cloned lamb called Polly, which carries a human gene.

The birth of the Poll Dorset lamb two weeks ago combined nuclear transfer technology with human gene research to produce a genetically engineered animal which will produce proteins from its milk to aid medical research.

Both techniques have been jointly developed by experts from PPL Therapeutics and the Roslin Institute.

The latest innovation was greeted cautiously by the Church of Scotland, which has closely monitored the cloning work surrounding the birth of Dolly, the world's first cloned sheep. However, the Kirk restated its opposition to the use of the techniques in human cloning and routine farm production.

Scientists hope the combined technology used to create Polly will lead to further development and research in the field of important therapeutic proteins. The proteins already produced from the milk of a transgenic sheep engineered at Roslin are currently involved in clinical trials for the treatment of cystic fibrosis.

Polly was one of five lambs transplanted into Scottish blackface ewes. Two others are expected to carry the same genes. She is one of a number of transgenic sheep created at Roslin since 1992, but is the first in the world to carry the human gene.

PPL's managing director Dr Ron James said: ''This result underlines our leading position in transgenic technology and brings nearer the human benefits from nuclear transfer work. It provides a solid platform from which PPL can now develop additional medical products using sheep and, hopefully, cows and pigs.''

Director of the Roslin Institute Professor Grahame Bulfield said: ''This pioneering work will stimulate new opportunities in both agricultural and biomedical research.''

The development will speed up the scientists' development of pioneering medical research through the generation of small, genetically identical, all-female founder flocks, reducing the time to produce vital proteins from their milk.

Outlining the Kirk's response to the latest addition to the Roslin flock, Dr Donald Bruce, director of the Church of Scotland's Society, Religion and Technology Project, said: ''From an ethical point of view, this does not pose any particular new problems.

''In May, the General Assembly of the Church of Scotland expressed an overall approval for the Roslin and PPL work towards producing therapeutic proteins in the sheep's milk. It expressed serious concerns about cloning of animals, if the nuclear transfer methods which produced Dolly were to be done routinely in agricultural production. But it saw no objection to their use for the very limited purpose of producing transgenic sheep for producing therapeutic proteins, which PPL have just announced.

''Polly indeed represents the logical next step in this work.''