Microsoft's president and chief executive, Mr Steve Ballmer, said yesterday the hackers who broke into the software giant's computer systems had gained access to some of its key programmes, but had not changed them.

"It is clear that hackers did see some of our source code," Mr Ballmer told Microsoft programmers and reporters at a seminar in Stockholm. Source code is the basic building block of all software programmes and Microsoft has always tried to keep its source code secret.

The company said it had reported the break-in , which it termed a "deplorable act of corporate espionage", to the FBI and was working with authorities to protect its intellectual property.

Asked how damaging the break-in had been, Mr Ballmer said: "Not very, but we want to make sure it doesn't get that way and that's why we called in the FBI."

Mr Ballmer said the burglars had not changed any of its software programmes, soothing fears that a virus had been hidden inside future releases of Microsoft products.

The Wall Street Journal, citing sources close to the situation, reported earlier that hackers were believed to have stolen the blueprints to the latest versions of its flagship operating system, Windows, and its Office software package.

Computer security experts said that hackers appeared to have used a "well-known worm" virus called QAZ, which first surfaced in China several months ago, to break into Microsoft's systems.

"This is very worrying [that Microsoft has been hit], because we have had detection for it for three months and we regard it as only a medium threat" rather than a new, high-risk virus, said Mr Raimond Genes, European marketing vice-president for Japan-based computer security company Trend Micro.

"We recently became aware of attacks to our corporate network," Microsoft spokesman Mr Rick Miller said.

"Microsoft is moving aggressively to isolate the problem and to secure our corporate network. We are confident that the integrity of our source code remains secure," he added. Asked if the attacks had stopped, Mr Miller said: "We believe so."

Microsoft's security employees discovered the break-in after they detected passwords being remotely sent to an e-mail account in St Petersburg, Russia, the Wall Street Journal reported.

The company interpreted electronic logs as showing that those internal passwords were used to transfer source code outside the Microsoft campus, it said.