Technological progress in integrated, low-power, CMOS communication devices and sensors makes a rich design space of networked sensors viable. They can be deeply embedded in the physical world and spread throughout our environment like smart dust. The missing elements are an overall system architecture and a methodology for systematic advance. To this end, we identify key requirements, develop a small device that is representative of the class, design a tiny event-driven operating system, and show that it provides support for efficient modularity and concurrency-intensive operation. Our operating system fits in 178 bytes of memory, propagates events in the time it takes to copy 1.25 bytes of memory, context switches in the time it takes to copy 6 bytes of memory and supports two level scheduling. The analysis lays a groundwork for future architectural advances.