The equilibrium geometries, binding energies, electronic structure, and magnetic properties of small stoichiometric MnO clusters are presented for the first time. The results are based on first-principles self-consistent calculations performed within the framework of density functional theory and the generalized gradient approximation. The nature of bonding between manganese and oxygen atoms is partly ionic. The charge transfer between Mn and O atoms, as well as the average Mn-O bond distance, remains insensitive to cluster size. However, the magnetic properties of these clusters exhibit very unusual characteristics. In contrast to their bulk behavior, the small clusters of MnO are ferromagnetic with magnetic moments per MnO molecule varying between 4 and 5 mu(B). Almost all of these moments are localized at the Mn site. The (MnO)(8) cluster exhibits magnetic bistability, with ferromagnetic and antiferromagnetic configurations being nearly degenerate. The structural growth of these clusters also differs substantially from those of alkaline earth metal-oxide clusters in that hexagonal packing and cubic packing compete for stability. (MnO)(2) and (MnO)(3) clusters show unusual stability, making them the skeletal structures for further growth. The results agree very well with available experimental data.