Fossils of the animal, standing just a yard tall at the shoulder, were discovered more than a hundred years ago but there had long been debate over whether it was a true mammoth of an ancient type of elephant.
Palaeontologists Victoria Herridge and Adrian Lister from London's Natural History Museum, writing in the Royal Society journal Proceeding B, said an analysis of the animal's teeth suggests it falls closer to the mammoth lineage, the BBC reported Wednesday.
The small size of the animal was a result of a phenomenon known as island dwarfism, they said.
"Dwarfism is a well-known evolutionary response of large mammals to island environments," Herridge said.
This evolutionary trend to smaller size is thought to be driven by the relative scarcity of food sources or by the absence of predators, the researchers said.
"Our findings show that on Crete, island dwarfism occurred to an extreme degree, producing the smallest mammoth known so far," Herridge said.
The researchers used a bone from the upper foreleg, or "arm," to estimate the size of the creature.
"The arm bone in particular gives us the best evidence so far for how big -- or rather, how small -- this dwarf mammoth really was," Herridge said.