What speakers mean by it now
English small is the ordinary word for modest scale. A room, a fee, a child, or a letter of the alphabet can all be small without any special tone. The adjective also shades into rank and character: a small part in a play, a small mind, the experience of being made to feel small. Those later uses grew out of size talk, but they are not the oldest layer.
Native, and already Old English
The origin of the word small is inheritance, not borrowing. It was in English before 1150, written as Old English smæl, and it passed into Middle English as smal, smale, and several other spellings before the modern form settled. Records from the Old English period already show the adjective, an adverb, and even a related verb. Nothing in the shape of the word is a prefix or a suffix that English speakers added later. Old English compared it as smælra and smælest; later English simply uses smaller and smallest.
The core Old English senses were thin, slender, narrow, and fine. Period glosses match smæl with Latin words for slim and slight, and they set greát and smæl as a pair: stout against thin as much as large against little. The word could also describe a voice that was not loud. The sense not large, of less than ordinary bulk, was already present in Old English as well. Size was available; it was not yet the only job.
The Germanic adjective behind it
Old English smæl continues Proto-West Germanic smal and Proto-Germanic smalaz. The reconstruction is not a guess from a single language. Closely matching forms run through the family: Old Saxon smal, Old Frisian smel, Old High German smal, Dutch smal, German schmal, Danish and Swedish smal, and Gothic smalista, the superlative smallest. Old Norse keeps a related noun smali for small cattle, especially sheep.
Those cognates still advertise the older meaning. German schmal means narrow or slender, not little in volume. Dutch smal and the Scandinavian adjectives lean the same way. English is the outlier that turned the inherited adjective into the general word for modest size, while much of Germanic kept it for width.
A step further back is less sure. Some references reconstruct a Proto-Indo-European base (s)mal- or (s)mel-, sometimes written (s)melo- and associated with a smaller animal. On that view, Greek mēlon (sheep), Old Irish mil (a small animal), and Slavic adjectives such as Russian malyj (small) would be relatives, and Latin malus (bad) is sometimes listed nearby. Anatoly Liberman has treated the non-Germanic ties as nearly certain, including the match with Russian mal. Guus Kroonen, in his etymological dictionary of Proto-Germanic, is more cautious and gives no cognates outside Germanic. The extra s at the front of the Germanic forms is often explained as the movable s of Indo-European roots, which would allow a link with Slavic mal- if the link is real. The Germanic family is solid. The wider Indo-European family is a live disagreement, not a closed case.
How the meaning moved in English
After the Conquest the size reading became the main one. By the mid-thirteenth century the adjective could mean young, of children. Late in the thirteenth century it covered degree and quantity. By the mid-fourteenth it named what is trivial or of little moment. Eighteenth-century English used it of limited property or trade. In the 1820s it could mean petty or selfish in spirit.
The older narrow sense shrank rather than vanished. It lingered in a few fixed places: talk of the intestines already in late Old English, and, from about 1300, the waist. The small of the back, for the narrowest part of the torso, is recorded in the 1530s. Everyday speech no longer calls a tall thin person small and expects a picture of a wand. Slim, slender, and thin took over that work.
The noun is almost as old as Middle English. Early in the thirteenth century it could mean a small person or animal. Around 1300 it named people of low rank, set against the great. Later set phrases grew from the value sense, not from a new root: small talk for idle conversation is recorded from 1751, small world as a remark on chance meetings from 1895, small potatoes for something petty in twentieth-century American English.
A leftover that still tells the older story
German schmal is the same inherited adjective, and it never became the ordinary word for little. It stayed with width. English small did the reverse: it became the scale word of daily speech, kept a few narrow leftovers such as the small of the back, and picked up social and moral uses as it went. The double l is a later English spelling. The history sits in smæl, a native Germanic adjective whose first reliable job was to name what is thin.