A miniature optical system for use in instruments based on laser spectroscopy of atomic and molecular samples, such as atomic frequency standards and magnetometers. The miniature optical system employs a folded optical path that allows light from a laser diode to pass through the cell twice, reflecting from a mirror and returning to a photodetector co-located with the laser diode. This efficient packaging arrangement allows the laser diode and photodetector to be fabricated on the same semiconductor substrate and allows essentially all of the gas cell volume to be utilized, without additional optical components for collimation. Fabrication of the laser source and detector on a single substrate permits cost-effective batch processing and parallel testing of the key active components.