http://udu.wiki.ubuntu.com/LightweightDesktop

The purpose of Ubuntu Lite (as I see it). Is to develop a version of
Ubuntu that will run on your Older systems. It is not another dsl,
knoppix or whatever, the aim is not to make another superlight OS. The
aim is to keep the spirit of Ubuntu  of a Humane version of linux that
anyone can use (and I mean anyone from Grandmothers to refugees) and
spread it to your older systems.

If we have to set low end specifications then we are talking pentium
200mhz 64mb ram (though this may be unrealistic) and 1.5gb hard drive.
Also the distro has to fit to a standard CD. Above all it has to be
useable (browse the internet, look at word documents, etc) and easy to
use (aim is for little to no computer experince).