Making things smaller is one of the important things that we do with nanotechnology.  Making transistors (those little switches that make up computer chips) smaller has been going on since they were first discovered 50 years ago.  Now scientists in Australia and the United States have made a transistor out of a single atom.  Yup a single atom.  The start by  digging a trench and then putting in just one atom of phosphorus.  Yup a single atom.
http://preview.tinyurl.com/7bhhgow