Answer:
Generally, teacup dogs are smaller varieties of toy dogs. The smaller varieties of some toy breeds are called "teacup", such as "teacup Chihuahuas", "teacup Poodles", etc.
However, teacup dogs are actually undersized toy dogs. This name is only a marketing technique used to increase dog sells by creating the impression that the "teacup" dogs are cuter and more valuable than toy dogs.
Usually, teacup dogs have many health problems and a shorter life span due to their small size. Their bones are also very fragile and can be damaged easily.
Also, teacup dogs are not approved by reputable kennel clubs including the Kennel Club (KC), the American Kennel Club (AKC) and the Continental Kennel Club (CKC). Teacups are not considered as a separate breed in any way or form.