Although it may be tempting to feel shortchanged by a postage stamp-sized lot, having a small yard actually offers advantages. Landscaping chores are usually minimal, and every plant gets the attention it deserves. It is possible to splurge on exotic specimens because one may be all it takes to fill a space, and if fortune provides a pre-built retaining wall, trellis it to create space for vertical plantings of all sorts.
If a retaining wall occupies one side of the narrowest part of your yard, expand it with clever use of color and disguise. Paint the wall a medium olive green. Attach lattice a few inches in front of the wall using wooden spacers attached directly to the wall behind it and lattice nailed to those. Paint lattice a slightly brighter tint of the same olive green (mix a bit of yellow in the paint). When completely dry, plant fast-growing vines like English or Boston Ivy--both hardy to zones 5 and excellent fast climbers, according to nurseryman Doug Green--at the base of the lattice and train them across. As the plant grows, the leaves will throw shadows against the wall behind the trellis, and the spacing will create the illusion of greater depth. The neutral greens of the wall and lattice make them disappear so the overall effect is of a deep wall of greenery resembling a hedge. Enhance the illusion of depth by installing frameless mirrors behind the lattice and vines at random. They will reflect sky, foliage and other plants in your garden to make visitors think they are seeing plants beyond the "hedge." (Warning: To protect birds who may be fooled and attempt to fly through your wall, position lightweight bird netting in front of the trellising before the mirrors. It will be virtually invisible under vines.)
Miracle in Miniature
One way to make a small yard seem bigger is to borrow a page from Hollywood and plant it full of the tiniest versions of everything you can find--from miniature roses to miniature trees. With everything in small scale, your yard will become a virtual scale model garden, and it will seem absolutely huge from your windows or patio. Enhance the effect by placing child-sized benches and tiny pots in the most distant areas of the yard and put matching full-sized furnishings close to the house. Visitors will be fooled into believing all the pots and benches are the same size and that those farther from them are much farther away than they actually are, thus giving an impression of a larger space. Place bonsai trees atop the retaining wall (especially if it is directly across from the house) and they will appear to be full-sized trees in the distance.
Forget trying to make your yard look bigger, broader and more spacious--wallow in the closeness. Make it your personal, snug little hideaway. Fill it with anything and everything you enjoy from banana trees to bubbling fountains. Fasten outdoor bas reliefs and hanging baskets on the retaining wall, and fill in every nook and cranny with pots of every size and description brimming over with plants of a variety of colors and textures. Put a tiny bistro table and a couple of chairs in the middle of a flagstone patio and enjoy your morning coffee while birds serenade you from your homemade jungle.