This complex and rare operation, previously thought suitable only for adults who had lost a digit, was successfully carried out on 40 children aged between nine months and 14 years.
At first, doctors at St James's University Hospital, Leeds, were unsure whether the technique could be used on children born with hand abnormalities, as they might not have the necessary tendons in their hands to graft on a new digit. Children's blood vessels were also believed to be too small for such an operation.
However, between 1988 and 1994 the surgery was carried out on 35 children born with hand deformities. It was also carried out on five who had injuries.
The result may not be perfect hands - the transferred toes still look like toes - but with time and further surgery, children are able to use the new digits as fingers. Depending on the degree of deformity at the start, the operation will restore a child's ability to pinch, grasp or squeeze.
A follow-up study showed that more than 90 per cent were able to grip paper and Duplo bricks, pull them apart and twist jar lids on and off.
Stacey Carter-Brooks, 10, from York, was realised her dream of playing the piano after surgery to her right hand.
"I know it is not a cosmetic hand," said Mr Simon Kay, consultant plastic surgeon at the hospital. "But it's an extremely functional hand. You have to be clear about the goals of surgery, whether restoring function or appearance. Both of the cases are very important. Hands are on view the whole time, like a face. You speak with your hands."
Having made the new digit function, Mr Kay works on restoring feeling and flexibility to the "finger" and revising its appearance. A year after the initial graft, the pulp under the toes is removed to make them less blobby and more finger-like.
In some cases, the tendons and joints are loosened to allow greater movement, and the new finger becomes stronger with time.
Nearly every child thought the appearance of their hands had improved, and 71 per cent said that they used their new digits almost all the time. In none of the cases was there any negative impact on the child's happiness, confidence or self-consciousness.
Only 34 per cent experienced teasing, but this was thought to relate to the deformity in general and not the transplant. The effect of removing a toe from a healthy foot was also less drastic than expected, as its absence is not glaring and scarring is limited.
According to the report, the best time for such surgery is at the age of two, when the child can get over the experience of going to hospital more quickly.
Experts are not sure how many children are born with hand abnormalities, and not all sufferers are suitable for this treatment, which is still very rare.
Only around 100 toe-to-hand operations have been carried out since this type of surgery began in the early Seventies. The first such operation was conducted on an adult in 1968.