We review the evidence that the ultra-compact dwarf (UCD) galaxies we recently discovered in the Fornax Cluster form a new, previously unknown class of galaxies and we discuss possible scenarios for their formation. We then present recent results that UCDs are also present in the Virgo Cluster, and that there is a much larger than expected population of fainter UCDs in the Fornax Cluster. The size and properties of this population may lead us to revise our original 'galaxy threshing' hypothesis for the formation of UCDs.