The Eh`häusl in Amberg, Germany bills itself as the smallest hotel in the world. It is only eight feet wide! The structure was built on a property of only 20 square meters, between two other houses. The history of the hotel is interesting, as told by Metafilter member woodblock100:

So here’s the story:
It’s 1728 and you live in Amberg, a little Bavarian town somewhere north of Munich. You and your lady friend really, really want to get married, but there is a little snag; the council laws permit only homeowners to marry, and you’re still stuck renting a place. But all is not lost! You pick up a little strip of empty land between two other buildings – just 2.5 meters wide. You run up a quick wall on the front, another on the back, slap a roof on top, and presto – you’re a homeowner. The council falls for it, and allows you to get married.

But now what? Well, it’s not liveable, so you head back to the rental place to live, but you recoup your investment by selling the Eh’häusl (Little Wedding House) to the next couple with the same problem.

There is no reliable record of how long the practice continued, but the building survived, and in 2008 it received a complete refurbishment, transforming it into a luxury hotel. Total size? 56 square meters. Maximum number of guests at any one time? Two. [Google street view]

But there's more! According to an old legend told by the locals, couples who spend their wedding night at the tiny hotel are guaranteed* to live happily ever after and never get divorced!