Chinese palaeontologist Lida Xing bought the apricot-sized nugget from an unsuspecting trader in 2015.

He told CNN that he realised immediately that he was looking at a vertebrate, rather than a fossilised plant.

"I was not sure that [the trader] really understood how important this specimen was, but he did not raise the price," Dr Xing, who is a palaeontologist at China University of Geosciences in Beijing, said.

After performing a CT scan and microscopic analysis, Dr Xing and his colleagues realised that the feathers did not belong to a bird because the specimen's tail vertebrae were not fused into a rod, as they are in modern birds.

The feathers most likely belonged to a baby nonavian theropod, meaning it looked more like a velociraptor or tyrannosaurus rex, depicted in films such as Jurassic Park, than a modern bird.

That said, it was probably only about the size of a sparrow.

After death, the tiny dinosaur's body was covered in resin, which is produced by trees as a defence mechanism against insect infestations. When it dries it becomes a plastic like substance that can survive for millions of years.

Dr Xing sent the fossil to Ryan McKellar, a palaeontologist at the Royal Saskatchewan Museum in Canada and an amber expert.

"Once the resin leaks out on the side of the tree, it's like a big sticky trap waiting for anything to fall into it," Dr McKellar said.

"Then, once the next resin falls on top of the existing one, it seals it in.

"When it hit my desk, I was blown away," Dr McKellar, a co-author of the research paper, said.

"It's one of those things where you're like, 'Wow, it's the closest you'll ever get to holding a fleshed-out dinosaur in your hands.' "

Using a high-powered microscope, Dr McKellar recorded images of the amber. Traces of pigmentation show the top of the feathers were a chestnut brown in colour, while the underside was a shade of white.

Sprouting from the tail, a dense covering of feathers can be seen with the naked eye.

The encased tail is believed to be just a portion of a relatively long tail.

Soft tissues thought to be muscles, ligaments and skin can also be seen.

But it was not the colour that fascinated Dr McKellar the most.

"I was seriously puzzled by the feather structure we're seeing in this sample," he said.

Most modern bird feathers have a central shaft called a rachis; think of the ink rod in a quill pen. Branching from the rachis are smaller shafts called barbs, and then branching from the barbs are even smaller filaments called barbules.

But this specimen lacked the rachis; it just had barbs and barbules down its ribbonlike tail.

"They are more fuzzy than sleek," McKellar said. "It shapes our view of how feathers came to develop in modern birds, and it gives us a rare glimpse of what dinosaurs looked like and potentially what feathers were being used for in the mid-Cretaceous."

It is the first time skeletal remains of a dinosaur have been discovered preserved in amber.

The find hints at a promising new future for the study of amber fossils, which retain details and organic material usually lost in compression fossils.

"It's a spectacular specimen," said Mark Norell, a palaeontologist from the American Museum of Natural History, who was not involved in the study.

"This is a novel feather type that we haven't seen before."

Dr Xing and his colleagues publishing their findings in the December issue of science journal Current Biology.

With Nicholas St Fleur, The New York Times