The prototype, that monitors glucose levels in tears, is one of several medical devices being designed by companies to make glucose testing for diabetics more convenient and less invasive than the traditional finger pricks.
Google says it will take at least five years to reach consumers.
The lenses use a minuscule glucose sensor and a wireless transmitter to help those who are among the world's 382 million diabetics who need insulin keep a close watch on their blood sugar and adjust their dose.
The contact lenses were developed during the past 18 months in the clandestine Google X lab that also came up with a driverless car, Google's web-surfing glasses and Project Loon, a network of large balloons designed to beam the Internet to unwired places.
But research on the contact lenses began several years earlier at the University of Washington, where scientists worked under National Science Foundation funding. Until yesterday their work had been kept under wraps.
"You can take it to a certain level in an academic setting, but at Google we were given the latitude to invest in this project," said one of the lead researchers, Brian Otis.
"The beautiful thing is we're leveraging all of the innovation in the semiconductor industry that was aimed at making cellphones smaller and more powerful."
American Diabetes Association board chairman Dwight Holing said he was pleased that creative scientists were searching for solutions for people with diabetes but warned that the device must provide accurate and timely information.
"People with diabetes base very important health care decisions on the data we get from our monitors," he said.
The device looked like a typical contact lens when Mr Otis held one on his index finger. On closer examination, sandwiched in the lens are two twinkling glitter-specks loaded with tens of thousands of miniaturised transistors. It is ringed with a hair-thin antenna.
"It doesn't look like much, but it was a crazy amount of work to get everything so very small," Mr Otis said at Google's Silicon Valley headquarters.
It took years of soldering hair-thin wires to miniaturise electronics, essentially building tiny chips from scratch, to make what Mr Otis said is the smallest wireless glucose sensor made.
Other non-needle glucose monitoring systems are also in the works, including a similar contact lens by Netherlands-based NovioSense, a minuscule, flexible spring that is tucked under an eyelid. Israel-based OrSense has already tested a thumb cuff, and there have been early designs for tattoos and saliva sensors.
A wristwatch monitor was approved by the FDA in 2001, but patients said the low level electric currents pulling fluid from their skin was painful, and it was buggy.
"There are a lot of people who have big promises," said Dr Christopher Wilson, chief executive of NovioSense. "It's just a question of who gets to market with something that really works first."
Palo Alto Medical Foundation endocrinologist Dr Larry Levin said it was remarkable and important that a tech firm like Google was getting into the medical field and he would like to be able to offer his patients a pain-free alternative from either pricking their fingers or living with a thick needle embedded in their stomach for constant monitoring.
"Google, they're innovative, they are up on new technologies, and also we have to be honest here, the driving force is money," he said.
Worldwide, the glucose monitoring devices market is expected to be more than 16 billion dollars (£9.8bn) by the end of this year, according to analysts at Renub Research.
The Google team built the wireless chips in clean rooms and used advanced engineering to get integrated circuits and a glucose sensor into such a small space.
Researchers also had to build in a system to pull energy from incoming radio frequency waves to power the device enough to collect and transmit one glucose reading per second. The embedded electronics in the lens do not obscure vision because they lie outside the eye's pupil and iris.
Google is now looking for partners with experience bringing similar products to market. It declined to say how many people worked on the project, or how much the firm has invested in it.
An early, outsourced clinical research study with real patients was encouraging, but there are many potential pitfalls yet to come, said University of North Carolina diabetes researcher Dr John Buse, who was briefed by Google on the lens last week.
"This has the potential to be a real game changer," he said, "but the devil is in the details."
Among those is figuring out how to correlate glucose levels in tears as compared with blood. And what happens on windy days, while chopping onions or during very sad movies? As with any medical device, it would need to be tested and proved accurate, safe, and at least as good as other types of glucose sensors available now to win US government approval.
About 35 miles from Google in the beach town of Santa Cruz, high school football coach and university senior Michael Vahradian, 21, who has been pricking himself up to 10 times a day for the past 17 years, said: "I remember at first it was really hard to make the needle sticks a habit because it hurt so much.
"And there are still times I don't want to do it; it hurts and it's inconvenient. When I'm hanging out with friends, heading down to the beach to body surf or going to lunch, I have to hold everyone up to take my blood sugar."
Karen Tank, who left her career as an economist to be a health and wellness coach after her Type 1 diabetes diagnosis 18 years ago, is also encouraged that new glucose monitoring methods may be on the horizon.
"It's really exciting that some of the big tech companies are getting into this market," she said. "They bring so much ingenuity; they're able to look outside the box."