The material compose of molecules that resembles living cells. Since organic materials are generally self-replicating, it can be used as the basis to a new material in which its replication can be controlled. It can be composed of actual living cells that are manipulated by nanobots so we are in control of its characteristics.
Like living cells the material can reproduce itself. For instance, when we suffer from injury, most of the cells can reproduce itself to heal the wound. So when parts of the material are damaged, it can repair itself through replication of cells. The material can grow under a process similar to cell division. In order for a cell to divide, its DNA must be replicated.
The material can contain “genetic information” similar to DNA. So it can be programmed to diversify itself into materials with different characteristics and functions.
Today, there are many materials that can store information. Smart materials or memory materials are in fact very common. Smart materials are materials that have one or more properties that can be significantly altered in a controlled fashion by external stimuli, such as stress, temperature, moisture, pH, electric or magnetic fields. (Wikipedia) Ferroelectric material has the ability to store information by the arrangements of its atoms. And ferroelectric memory is already widely in use, in items such as train tickets that contains wireless transmitter. Therefore, programming genetic information into a material is achievable.
Researchers at NYU have successfully built a simplistic nanobot out of DNA. The strands of DNA are programmed to perform movements. And the strands can be opened and closed repeatedly—making the it a tweezer made of DNA.
Looking through the websites, it prompts me to think about the risks and trade-offs of a research project like that. Without doubt, there are going to be many unsuccessful byproducts. For instance, would all the unsuccessful florescent bunnies be killed? This would certainly anger animal rights group. Even worse, What if the research goes out of control? The material cannot stop replicating itself and cover the whole surface of earth with it. Many science fiction villains are the products of out of control lab experiments.