Like the headline says, I only just heard about this one, and there is only a few days to go. Aside from the monetary prizes, it looks like a good way to get your name out there. Go take a look at the blurb you need to join the forum and submit your work as a post. Here is the email I got:

Reminder:  Smashwords is sponsoring a free writing contest in conjunction
with Editor Unleashed. The deadline for posting your entry is June 14.  Simply
write 1,000 words or less, post it to the Editor Unleashed forum, and win $500
if you’re the Grand Prize Winner.  39 “Editor’s Choice” winners will each receive
$25.  Winners will be selected based on a combination of reader votes (starting
June 15, you can promote your entries on your blog, social networks and websites)
and an independent panel of judges (Maria Schneider + professional literary agents
and editors).

At last check, there were about 150 entries, so the odds of landing in the top
40 to win a cash prize are reasonably good if you’re an excellent writer.

I’m not a judge and I have no influence over the outcome so don’t send me your
entry or try to lobby me.  :)

All 40 winners will be published in a Smashwords ebook anthology that will be
available for free download to anyone.

For complete instructions, visit http://editorunleashed.com/2009/05/18/flash-fiction-40-contest-launch-today/

Thanks to Maria Schneider of Editor Unleashed for originating the idea for this
contest and managing it.  Also thanks to Kat Meyer of Next Chapter Communications
for creating the logo and award buttons for the contest.