This week Google announced it is now making it possible to create custom ad sizes. This capability will provide publishers with more flexibility to design for users.
Custom size ads work just like the standard-size units, showing either text or display ads depending on which is likely to have the best performance for the impression. Google's system predicts the value of each competing ad based on historic performance, so before it can optimize the number of ads shown on a page, Google is going to need some time to gather data.
Google did indicate that they were putting a few restrictions in place around the maximum and minimum pixels for ad sizes - for example, ad sizes that are outside of the restrictions won't appear. The size restrictions include: only one dimension can be greater than 300 pixels, the minimum width is 120 pixels, the minimum height is 50 pixels and neither the height or width can exceed 1200 pixels.