The health benefits of the surgery are clear and substantial for people who are severely overweight, the authors told PLoS Medicine.
They say 1.4m people in England could benefit.
Currently, around 8,000 people a year receive the treatment on the NHS.
If all 1.4m were offered bariatric surgery, the researchers estimate it would avert nearly 5,000 heart attacks and 40,000 cases of type 2 diabetes over four years.
All surgery carries risks, however, and so people should only be offered surgery if attempts to lose weight through healthy eating and physical activity have already been tried and not worked, they add.
Experts said surgery should not be seen as a `quick fix`.
For the study, the researchers compared 3,882 patients who underwent weight loss surgery with an identical number who did not.
They looked at gastric bypass, sleeve gastrectomy and gastric banding. All led to a dramatic and sustained weight loss of between 20kg and 48kg. And the weight stayed off.
This, in turn, significantly lowered the person`s risk of developing type 2 diabetes, high blood pressure, angina and heart attacks.
Among those who already had diabetes, their condition improved substantially and many (60%) were able to come off medication altogether.
Lead researcher Dr Ian Douglas, from the London School of Hygiene and Tropical Medicine, said: "The results are really encouraging. Obviously we would love to help people lose weight in other ways, through exercise and healthy diets, but that`s difficult. Diets do not always work well for everyone.
"We are not saying surgery is right for everyone, but it can be really effective."
Dr Alasdair Rankin of Diabetes UK warned bariatric surgery should not be seen as a one-stop solution for type 2 diabetes and obesity.
"It should be offered along with ongoing support and clear plans for long term follow up."
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