Inertial and magnetic sensors are valuable for untethered, self-contained human movement analysis. Very recently, complete integration of inertial sensors, magnetic sensors, and processing into single packages, has resulted in miniature, low power devices that could feasibly be employed in an implantable motion capture system. We developed a wearable sensor system based on a commercially available system-in-package inertial and magnetic sensor. We characterized the accuracy of the system in measuring 3-D orientation-with and without magnetometer-based heading compensation-relative to a research grade optical motion capture system. The root mean square error was less than 4° in dynamic and static conditions about all axes. Using four sensors, recording from seven degrees-of-freedom of the upper limb (shoulder, elbow, wrist) was demonstrated in one subject during reaching motions. Very high correlation and low error was found across all joints relative to the optical motion capture system. Findings were similar to previous publications using inertial sensors, but at a fraction of the power consumption and size of the sensors. Such ultra-small, low power sensors provide exciting new avenues for movement monitoring for various movement disorders, movement-based command interfaces for assistive devices, and implementation of kinematic feedback systems for assistive interventions like functional electrical stimulation.