What you see there is a cross-section of an "optoelectronic" fiber. It's a light-sensing strand MIT is developing that it says could capture an image. Led by Associate Professor Yoel Fink of MIT's Department of Materials Science and Engineering, the research is still far from yielding any real-world applications, but the project just hit a milestone, namely using the fabric to take a rough snap of a smiley face.
In the future, the group can see the fibers used in multiple ways, including being weaved into a soldier's garment. Since the fibers can capture an image, he could observe his surroundings through a heads-up camera feed instead of having to swivel around.
The fibers also one-up cameras as they have the potential to be far more durable. "We are saying, 'instead of a tiny, sensitive object [for capturing images], let's construct a large, distributed system,'" Fink told MIT News, "While the current version of these fabrics can only image nearby objects, it can still see much farther than most shirts can."
Well, sci-fi-ish project or not, he's got a point there.