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http://www.socialtimes.com/2008/01/twitter-adopts-tinyurl/ -
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But I don't see why they need a URL-shortener at all (one that acts as a forwarder, anyway). Why can't the API just accept links directly without it counting towards the 140-character limit? Or they can charge us 20 characters per link if they insist; and display URLs as "http://www.socialtimes.com/2008..." or just as hyperlinks around words if possible.
I 'get' the 140-char limit, but having us worry about how to enter URLs, and whether or not the forwarding will work - not to mention our recipients having no idea where the link is going... Well, I think the whole thing is an unecessary limitation!