Olimex has been making small Arduino and Arduino-like boards for many years, but their latest announcement squeezes the AVR platform into the smallest physical footprint yet, just 16.9 x 12.7 mm for their OLIMEXINO-85S.
That's barely bigger than the connectors, one of which is a LiPo battery connector, which brings to mind that an attached LiPo cell is very likely to be much bigger than the whole board.
Next step in the downsizing .... mount the connectors vertically! 
Morgaine.