Nearly 25 years ago, American millionaire Robert Klark Graham hatched a daring plan. By collecting sperm from Nobel laureates in science and distributing it to intelligent women, he wanted to breed an entire generation of geniuses.

Unfortunately for Graham, the scheme made him a pariah, eliciting accusations of racism and elitism. His Nobel Prize sperm bank shut up shop nearly five years ago but not before hundreds of women had signed up for its unique service. Now, one tantalising question remains: what has happened to the genius children?

Graham was a latecomer to the eugenic ideas that had enthralled America and Britain in the early 20th century. Nazism and America's dismal history of forced sterilisation had disgraced eugenics, but Graham was undeterred. Growing up in the rural Midwest in the early 20th century, he drafted a muscular book, The Future of Man, arguing that humans had jumped the evolutionary track. Now that we controlled our environment, the weak were not killed off before they reproduced, as in nature.

In modern America's cradle-to-grave social welfare, the incompetents and imbeciles - "retrograde humans" was Graham's term - were swamping the intelligent. Our genetic decay would surely lead to global communism. All that could save us, Graham warned, was "intelligent selection". Our best specimens - our great white men - must have more children, he said.

When Graham announced his plan, he expected adulation and a rush of donors. Instead, he became a national villain. Graham's obsession with genetic decay seemed sinister. His eugenic views and latent racism were 50 years too late for social respectability. The enterprise was ridiculed in the press. Two of his Nobelists quit, fearing that their identities would be uncovered.

The bank's image was permanently smeared when the third Nobelist identified himself. It was physicist William Shockley, a giant of American science who had won the prize for inventing the transistor, then founded the first company in Silicon Valley. But he had become a national pariah for his insistence that blacks were less intelligent than whites and his proposals to sterilise people with low IQs. Shockley's involvement turned the bank from a joke into a menace. Graham, whose estate was picketed by demonstrators, hired guards to protect his precious vats of frozen sperm.

Scarred by bad press, Graham ducked out of sight and the Nobel bank disappeared from the newspapers. But women from all over the country kept knocking on its door and the babies started arriving, first a couple a year, then dozens. Graham was prouder of the babies than he was of his own children, and was known to send them gifts. But he spoke rarely to the media and kept the identities of donors and kids well-guarded. He died suddenly in 1997, at the age of 90. His children and widow shut the bank in 1999, leaving a tantalising mystery. The bank had fathered more than 217 kids, but records were sealed and donor identities remained secret. Did this odd genetic engineering experiment succeed?

To answer the obvious question: no, they are not all geniuses. Some are dazzling. Sam, 14, breezes his way through college maths and is a brilliant athlete. Joy gains straight As, dances the lead in the Nutcracker and plays two difficult instruments. But the kids are spread in a bell curve, slid a bit to the right of average. Some are brilliant. Most are very good students. And some are quite mediocre. Three of the 30 I know have severe health problems.

But, to point out the obvious, this is no scientific sample and no proof of nature's triumph over nurture. The kids I know are not a cross-section - they are the families who saw a story I had written for [internet magazine] Slate, asking anyone who knew about the sperm bank to come forward. Moreover, the bank could never have been a controlled experiment, because it didn't attract a random group of parents. The women who seek out a Nobel Prize sperm bank become the over-involved mums who push their children into piano lessons at 3 and ancient Greek at 5. It is impossible to determine if their children's talents are the result of nature or nurture, because they are getting double helpings of both.

Genetic expectations sometimes burden the children of the repository. Doron Blake's mother put him in front of TV cameras when he was two weeks old, then let the press watch him grow up. He was a prodigy, playing on computers at two, reading Hamlet at six, writing a book at 11 and scoring 180 on an early IQ test. When I spoke to him two years ago, he spent much of the interview discussing how foolish it is to judge anyone by his intelligence, how intelligence means little. As he's grown up, Doron has grown disillusioned with the genius sperm bank. It's what's in your heart, not your brain, that matters, he says - a sentiment that would outrage Robert Graham.

The Nobel Prize sperm bank had a big impact on the fertility business. In a generation, fertility has transformed from the mysterious domain of dictatorial physicians to a customer-friendly business. Graham, more or less by accident, helped bring about this transformation. Before the genius sperm bank, donor insemination was an unpleasant business, with couples who sought it at the mercy of their doctor, who simply inseminated the woman with a vial of freshly collected sperm, source unknown. Doctors would guarantee nothing but, at the most, the donor's blood type and eye colour. Couples were expected to keep the secret, pretend that the child was their own, and ask no questions.

Graham, though an unabashed elitist, upended the hierarchy of donor insemination. The customers became the boss, the doctors the servants. His innovations helped to turn the suspect practice of donor insemination into a thriving industry. Now, sperm banks follow his marketing-oriented lead and more than 30,000 children a year are born from anonymous donor insemination in the US. Sperm banks now publish massive online catalogues, allowing customers to read donor essays, buy baby pictures of the donor, and vet everything from a donor's SAT scores to his great-aunt's history of eczema.

The Nobel sperm bank democratised fertility, but it didn't do what Graham hoped it would - namely, control fertility. Graham used the best science of his day to programme the kids for success. Some of the kids are brilliant, some aren't. Some are good athletes, some aren't. Most are healthy, but some aren't. The lesson of the Nobel Prize sperm bank is that embryos may be tweaked, fiddled with and designed, but children will always be themselves.

· David Plotz, deputy editor of internet magazine Slate.com, is writing a book about the Nobel Prize sperm bank. The TV documentary, Genius Sperm Bank, will be shown on the Discovery Channel on Monday, April 26, at 10.30pm.