We report on cavitation in confined microscopic environments which are commonly called microfluidic or lab-on-a-chip systems. The cavitation bubble is created by focusing a pulsed laser into these structures filled with a lght-absorbing liquid. At hte center of a 20 mu m thick and 1 mm wide channel, pancake-shaped bubbles expand an collapse radially. The bubble dynamics compare with a two-dimensional Rayleight model and a planar flow field during the bubble collapse is measured. When the bubble is created close to a wall a liquid jet is focused towards the wall, resembling the jetting phenomenon in axisysmmetry.