The person in the video, who appears as a ringer for Al-Qaeda chief Osama bin Laden, is seen walking on a dusty street, thought to be in Afghanistan, with a deadly AK-47 assault rifle slung over his shoulder.
The clip, accompanied by Jihad-style chanting, was first posted on US website LiveLeak and has had 43,000 viewings so far.
Over 2,000 people have also seen it on YouTube.
According to The Sun, the miniature mujahideen has been nicknamed 'Bin Laden's Mini-Me' after the diminutive character in the Austin Powers spy movies.