The new scanner uses digital camera technology and specialised software to give doctors and veterinarians colour images of what is inside their patients' bodies.
At present, scanners could only produce black and white images, and Dr Butler said the arrival of colour images was being eagerly awaited by clinicians all over the world.
"The pictures we are able to produce are fantastic and everyone is very interested in what our machine can do," he said, speaking from Australia where he is holidaying after attending a radiology (medical imaging) conference.
Dr Butler said he expected colour CT scanning to be standard technology internationally within 10 years because it gave doctors, researchers and vets much clearer pictures of cancerous tumours and problems like heart disease and blood vessel damage.
Dr Butler (33), who graduated from Otago Medical School in 1998, also has physics and radiology qualifications and a PhD in computing.
He obtained funding two years ago to bring together a team of 25 specialists in Christchurch to produce a colour scanner.
The team was recently awarded a $4.5 million Foundation for Research, Science and Technology grant to continue its work for the next six years.
Physicists had known for a long time that different parts of a human or animal give off different wave lengths according to their density which were the X-ray equivalent of red, green and blue light, Dr Butler said. But until recent advances in digital photography and software, it had not been possible to record the colours and turn them into useful images.
His team had carried out all parts of the project including electronics, mechanical design, X-ray physics, image recovery and processing, data visualisation and clinical applications.
"I think the uniquely successful thing about our team is we have people interested in every part of the process. New Zealand is small enough that everyone knows everyone else in the team. If we have a problem . . . we just go to the specialist in that area and discuss it."
Dr Butler said he hoped colour scanners would be in regular use in New Zealand within three to five years.
The project team had patented its technology and set up a commercial arm, Mars - Medipix All Resolution System - to begin manufacturing benchtop-sized colour scanners in New Zealand within the next six months. Negotiations were also under way with international scanner manufacturers to use the NZ-developed technology in their larger machines.
CT scan
• A CT (computerised tomography) scanner is a special kind of X-ray machine. Instead of sending out a single X-ray through a patient's body, several beams are sent simultaneously from different angles. Beams that pass through less dense parts of the body such as muscle and organs will be stronger, whereas beams which pass through denser parts such as bone will be weaker. This information is used to create a series of two-dimensional or three-dimentional pictures which can be viewed on a computer screen.
• CT scanning was invented by British electrical engineer Sir Godfrey Hounsfield in the 1960s. The first commercially manufactured CT scanner was used to scan brains in 1971. Full body scanners became available in 1975.
• CT scanning is particularly useful for locating bleeding in the brain, as well as tumours, organ damage, broken bones and and abscesses throughout the body.
• CT scanning is also used widely by researchers to study laboratory animals, and by veterinarians.