We present evidence for a drop in the luminosity function around spectral type M7–M8. This shows in both field stars and the clusters σ–Orionis, the Trapezium, IC 348, IC 2391, α–Perseii, the Pleiades and, possibly, the globular cluster M4. This can be explained by a sudden drop in the luminosity-mass relation. Theoretical models, which include dust, do not show this effect, although they predict dust forming at about spectral type M7. We suggest that this drop in the luminosity-mass relation could be modelled by considering larger size dust grains. The drop in the luminosity-mass relation suggests that star/brown dwarf masses below M7–M8 will be larger than predicted by current models.