The scanning tunneling microscope has been an extremely successful experimental tool because of its atomic-scale spatial resolution. In recent years this has been combined with the use of low temperatures, culminating in precise atom manipulation and spectroscopy with microvolt energy resolution. In this talk I will review recent developments in investigating the electronic and magnetic properties of atoms and small clusters of atoms on surfaces. A large cluster of magnetic atoms behaves similar to a macroscopic magnetic particle: it's magnetization points along an easy-axis direction in space and magnetization reversal requires sufficient thermal energy to overcome a barrier. How many atoms does it take to create such a magnet? What are the properties of individual atoms on surfaces? Those are important questions for future technologies as well as for basic understanding of materials.