The smartphone, which is being made by Asian manufacturers, will use 'in-cell' screen technology, according to the Wall Street Journal. This means touch sensors are integrated into the LCD screen negating the need for a separate touch-sensitive layer. See also: iPhone 5 release date, specs and rumour round-up.
According to the report, the panel is being mass produced by display makers Sharp and Japan Display Inc, a firm merging three Japanese electronics manufacturers' display units as well as LG Display.
Since the new technology does away with a layer, the screen, overall, is thinner and also improves the quality of the image being displayed. It will help Apple make the iPhone 5 a slimmer device than predecessors. See also: iPhone 5 goes up for pre-order.
A slimmer edition of the iPhone would help Apple in its rivalry with Android smartphones such as the Samsung Galaxy S3 which uses thin OLED screen technology, something the Korean firm touts as a standout feature.
It has been rumoured a number of times that the iPhone 5's screen will be larger than the 3.5in previously used and the device will launch in the autumn. See also: iPhone 5 to launch on 7 August?