It seems that the image below was accidentally taken since the person is showing off his new Microsoft arc mouse.  At first I thought that maybe the thinner Xbox 360 was a HD-DVD player but the device seems to have two memory card slots.  Since the drive cover is chrome one would think the device is a Pro model but is could be an Arcade model.  The smaller 360 seems to be half the width of the original but the same height.  One thing that has me wondering is how will this work with the existing detachable HDD?  I'd be trading mine in for this thinner model in a heart beat but if I can't swap my HDD I'll pass.

Update:  It seems that this is just some funny angle making the inner 360 look slimmer.  It would be cool to see a new slimmer 360 come to market but this is not one of them.

Source:
engadget.com
winsupersite.com