Achondroplasiaphobia, along with nanosophobia (from nanosomia), birchophobia (from Simon Birch), and lollypopguildophobia (from the Lollypop Guild) are made-up terms meaning a fear of little people. Achondroplasiaphobia is perhaps the most common of these terms, and perhaps the most sane, as achondroplasia is an actual form of dwarfism, specifically, one in which people develop a normal-size trunk and head, but stunted limbs.
As far as I can determine, someone who truly had a fear of little people would probably be diagnosed with teratophobia. This is an abnormal fear of deformity in others, although it is most often defined as the pathological fear of giving birth to a deformed child. The fact that these two meanings are covered by one term helps illustrate how rare this sort of thing really is. This is in part due to the fact that very few people actually have this sort of phobia, and in part to the fact that the definition of a true phobia includes something like "causes a significant interference in social or occupational activities." This clause means that even those who do have an irrational fear of dwarves are unlikely to get a formal diagnosis unless they live near or work with someone with dwarfism.
A few possibly related terms: fear of deformity in oneself, including fear of dwarfism, is dysmorphophobia. Those with limited exposure to dwarfism may actually be suffering from automatonophobia, the fear of 'false humans' -- although this more properly refers to dolls, ventriloquist's dummies, animatronic creatures, wax statues, or anything else that falsely represents a human being. If this is the case, actually meeting a person with dwarfism might well be enough to exclude them from the phobia.