We review recent progress at the Centre for Cold Matter in developing atom chips. An important advantage of miniaturizing atom traps on a chip is the possibility of obtaining very tight trapping structures with the capability of manipulating atoms on the micron length scale. We recall some of the pros and cons of bringing atoms close to the chip surface, as is required in order to make small static structures, and we discuss the relative merits of metallic, dielectric and superconducting chip surfaces. We point out that the addition of integrated optical devices on the chip can enhance its capability through single atom detection and controlled photon production. Finally, we review the status of integrated microcavities that have recently been demonstrated at our Centre and discuss their prospects for future development.