A plastic bathing cap filled with cool water may hold the key to preventing brain damage in new-born babies.

The results of a global study, published online in the Lancet today, demonstrate for the first time that the damage may not be irreversible.

The $100 head-cooling cap was developed in Auckland and is designed to cool the head to stop brain cells dying after a bruising birth.

The affliction devastates hundreds of families each year and is the commonest cause of multi-million pound lawsuits against Britain's National Health Service.

The polythene hat, worn for three days immediately after birth, saved one in six babies who suffered oxygen deprivation at birth from death or lifelong disability in a trial conducted in four countries, including New Zealand.

Doctors believe there is further potential to save more babies by refining the treatment. Studies are underway into total body cooling which could be simpler to control.

One or two babies in every 1000 born in New Zealand, or about 100 babies a year, are at risk of brain damage during birth. Brain damage caused by oxygen deprivation at birth affects 600-700 babies a year in the UK.

As well as being a catastrophe for the family, it is a major burden on society.

The lifelong costs of care for a severely brain damaged baby can be as high as $13 million.

Often there is no warning of a problem throughout pregnancy until in the last critical moments disaster occurs. The umbilical cord may become trapped round the baby's head or the womb may rupture down a previous Caesarean scar. Once the baby is born the oxygen supply is restored - but by then it is too late. Any restriction of the blood flow to the brain was thought to cause damage within minutes.

Research a decade ago showed that when the brain is starved of oxygen damage does not occur immediately and there is a window of a few hours when the effects are treatable.

By cooling the brain, doctors believe they can interrupt the "chemical cascade" triggered by the lack of oxygen which leads to brain damage hours or days afterward.

John Wyatt, professor of neonatology at University College Hospital, London, said: "What this confirms is the brain damage is not irreversible at the moment of delivery which is what we have always believed. This is the clearest evidence that intervention at birth can improve the outcome."

For the trial, researchers in hospitals in Canada, the US, New Zealand and the UK selected 234 babies who were deprived of oxygen at birth and whom tests of electrical activity in the brain showed were at high risk of brain damage.