I live in a 320 SF hotel room that I bought with my husband... you can check out the specifics here.
I specifically know of one other blogger, @Steve , who lives in a tiny space, an airstream.
While the 'pros', for me, far outweigh the 'cons', there are still two 'cons' for me: 1. not being able to close off the bedroom... my husband and I have different sleep habits, so this would be helpful. 2. no balcony. I've lived in a lot of condos and apartments and I've never been in a situation where I had to go down 5 flights of stairs to 'get outside'.
Other than that, the obvious cons for many other people, living in our space, would be children and pets. One cat or small dog would work fine where we live, but larger dogs, or multiple animals could be a problem, since there is not easy access to the outdoors.
I'm wondering if there are any other PF folks on this forum who live in tiny spaces, or plan to. If so, what are your pros and cons?