"Over recent years, scientists have become pretty good at working with stem cells and coaxing them to develop into different types of adult cells and tissues," said Ali.
"But until recently, the complex structure of the retina has proved difficult to reproduce in the lab. This is probably because the type of cell culture we were using was not able to recreate the developmental process that would happen in a normal embryo."
Ali added: "The next step will be to refine this technique using human cells to enable us to start clinical trials."
The study appears in the journal Nature Biotechnology.
Last month, Japanese authorities approved proposals for the world's first clinical trials using stem cells harvested from a patient's own body. The goal is to test therapy for AMD using so-called induced pluripotent stem cells, or iPS.
These are adult cells that have been reprogrammed to return to their infant, versatile state. Provided that they are proven safe, they can provide a non-controversial alternative to stem cells culled from early-stage embryos.