
The technique employs a new semiconductor material that allows a vacuum to be used as an insulator instead of the traditional glass-like components.
The material "self assembles" in a similar way to snowflakes, seashells or teeth enamel before being used to coat silicon wafers.
When the material is baked it forms trillions of uniform holes that measure just 20nm across.
This pattern is then used to create a chip's copper wiring, and provides the insulating gaps that allow electricity to flow smoothly.
John Kelly, senior vice president of technology and intellectual property at IBM, called it one of the biggest breakthroughs he had seen in the past 10 years.
"The holy grail of insulators is to use a vacuum and we have broken the code on how to do this," he told Reuters.
IBM plans to incorporate the technology into its chips by 2009, but has already made successful prototypes which means that the technology could appear sooner.
Big Blue also plans to license the process to companies such as AMD and Toshiba.
The technology is the latest in a line of IBM chip advancements this year, following a chip-stacking technique last month and a method to stop energy loss in January.