A modder by the name of Bandit5317, has created the worlds smallest Xbox mod. He calls it the Xbox Micro, standing at 1 inch thick. The project took about 6 months, and the results were indeed impressive.
Basic information about this mod:
Dimensions: 23.5 x 21.65 x 2.5 cm
320 GB 2.5″ HDD
TSOP flashed with iND-BIOS
You can view the snapshots below, more pictures at the link: