Arrayed waveguide grating (AWG)-type optical components are widely used in optical transmission system, and the low cost AWG chips are in more and more urgent need. Among all the methods for lowering the AWG cost, reducing the AWG chip size is one of the most effective methods. A novel compact AWG based on low refractive index contrast silica-on-silicon (SoS) technology was proposed. In this AWG, only the segments connected with the slab waveguides in the input and output waveguides are air trench (AT) waveguides. By using these AT segments, the distance between the adjacent output waveguides connected with the output slab was decreaced greatly, so the focuses of slab waveguides, and the number of arrayed waveguides were decreaced greatly. Thus, the size of AWG chip was decreased dramatically. The arrayed waveguides and the segments coupling to fibers in the input or output waveguides were all fabricated with low refractive index contrast waveguides, for the purpose to obtain low coupling losses with fibers and good performances as traditional SoS AWGs. The size of an AWG designed consisting 40 channels on 100 GHz ITU grid is only 23.88 mm×10.5 mm, which area is about 1/6 of a traditional AWG with the same function.