Scholars of human evolution have been all abuzz recently about the discovery of Homo floresiensis, a new hominid species. Apparently the bones are sufficiently recent that they had not even fossilized. A quick run-down of the facts is available here:
In addition to a small body size, H. floresiensis had a remarkably small brain. The type specimen, at 380 cm³(23 in³), is at the lower range of chimpanzees or the ancient Australopithecines. The brain is reduced considerably relative to this species' presumed immediate ancestor H. erectus, which at 980 cm³ (60 in³) had more than double the brain volume of its descendant species. Nonetheless, the brain to body mass ratio of H. floresiensis is comparable to that of H. erectus, indicating the species were unlikely to differ in intelligence. Indeed, the discoverers have associated H. floresiensis with advanced behaviors.
The other remarkable aspect of the find is that this species is thought to have survived on Flores until at least as recently as 12,000 years ago. This makes it the longest-lasting non-modern human, long outsurviving the Neanderthals (Homo neanderthalensis) who went extinct about 30,000 years ago. H. floresiensis certainly coexisted with modern humans, who arrived in the region 35,000-55,000 years ago, for a long time, but it is unknown how they may have interacted.
The essay also points out that there is clear evidence of the use of fire and the use of sophisticated stone tools.