The Swiss food giant said it had made a scientific breakthrough that has the potential to reduce sugar in its treats by up to 40 per cent, without affecting the taste.
Nestlé said it was securing a patent for its innovation, and it would start using the new sugar across its range from 2018.Stefan Catsicas, the company's chief technology officer said: "Our scientists have discovered a completely new way to use a traditional natural ingredient."
Using only natural ingredients, Nestlé said its researchers had found a way to structure sugar differently, so that less sugar can be used in its chocolate.
If the new sugar lives up to its billing, it would represent a milestone in the food business's never-ending quest for more healthy ways to sweeten products. Professor Julian Cooper, an independent food technology consultant, told the BBC that Nestlé's development was important: "This is good science. A lot of people have been looking at sugar trying to reduce the amount."
Nestlé's breakthrough follows PepsiCo's recent commitment to spend billions of dollars creating new snacks and beverages, and reformulating existing ones to cut salt, sugar and fat content.
Earlier this year, Coca-Cola changed its Coke Zero recipe and renamed it Coca-Cola Zero Sugar in the UK to make it "taste more and look more" like the original one, the company said. The move to replace Coke Zero was supported by a £10m campaign.
The company said it wants to encourage people to reduce their sugar intake without sacrificing the taste of Coca-Cola, which involves nine teaspoons of sugar in a 330ml can.Nestlé, move comes as the UK and some cities in the US implement sugar taxes to help fight childhood obesity and diabetes, which affects four times as many people now than in 1980.
The World Health Organisation previously said increasing the price of sugary drinks by 20 per cent would reduce sugar consumption by a fifth.