Marc Levoy:

When you move the sensor in a digital camera relative to the lens, the plane in object space that is sharply focused moves as well. How far can you move the sensor before a sharply focused feature goes out of focus? To answer this question, we must first define what we mean by "out of focus". The standard definition is that the width of the blurred image of the feature has become larger on the sensor than some maximum allowable circle of confusion. This size of this circle is arbitrary, but a reasonable choice is to make it equal in diameter to the width of a pixel. The thick black vertical bar at the right side of the applet above represents one circle of confusion.