The Kuiper belt is a remnant of the primordial Solar System. Measurements of its size distribution constrain its accretion and collisional history, and the importance of material strength of Kuiper belt objects (KBOs)(1; 2; 3; 4). Small, sub-km sized, KBOs elude direct detection, but the signature of their occultations of background stars should be detectable (5; 6; 7; 8; 9). Observations at both optical(10) and Xray(11) wavelengths claim to have detected such occultations, but their implied KBO abundances are inconsistent with each other and far exceed theoretical expectations. Here, we report an analysis of archival data that reveals an occultation by a body with a ∼500 m radius at a distance of 45 AU. The probability of this event to occur due to random statistical fluctuations within our data set is about 2%. Our survey yields a surface density of KBOs with radii larger than 250 m of 2.1 +4.8 −1.7 × 10 7 deg −2 , ruling out inferred surface densities from previous claimed detections by more than 5 σ. The fact that we detected only one event, firmly shows a deficit of sub-km sized KBOs compared to a population extrapolated from objects with r > 50 km. This implies that sub-km-sized KBOs are undergoing collisional erosion, just like debris disks observed around other stars.A small KBO crossing the line of sight to a star will partially obscure the stellar light, an event which can be detected in the star's light curve. For visible light, the characteristic scale of diffraction effects, known as the Fresnel scale, is given by (λa/2) 1/2 ∼ 1.3 km, where a ∼ 40 AU is the distance to the Kuiper belt and λ ∼ 600 nm is the wavelength of our observations. Diffraction effects will be apparent in the star's light curve due to occulting KBOs provided that both star and the occulting object are smaller than the Fresnel scale (12; 13). Occultations by objects smaller than the Fresnel scale are in the Fraunhofer regime. In this regime the diffraction pattern is determined by the size of the KBO and its distance -2 -to the observer, the angular size of the star, the wavelength range of the observations and the impact parameter between the star and the KBO (see Supplementary Information for details). The duration of the occultation is approximately given by the ratio of the Fresnel scale to the relative velocity perpendicular to the line of sight between the observer and the KBO. Since the relative velocity is usually dominated by the Earth's velocity around the Sun, which is 30 km s −1 , typical occultations only last of order of a tenth of a second.Extensive ground based efforts have been conducted to look for optical occultations (10; 9; 14; 15). To date, these visible searches have announced no detections in the region of the Kuiper belt (30-60 AU), but one of these quests claims to have detected some events beyond 100 AU and at about 15 AU (10). Unfortunately, ground based surveys may suffer from a high rate of false-positives due to atmospheric scintillation, and lack the stability of space based platforms. The ground ...