Make sure it isn't just an adjustment problem -- you can probably lower the seat and handlebars, and move the seat forward.

I'm 5"5' and I'm currently riding an 18" mountain bike, which I think is a bit of a stretch for me. The seat doesn't move any farther forward and I feel like I'm reaching too much for the handlebars. If the seat were any lower I wouldn't get enough leg extension in pedaling, but as it is I can barely stand on one foot when stopped at a traffic light.

Then again, an 18" bike with a different frame geometry might work better -- I like bikes with the pedals further forward than on a mountain bike, which would probably let me lower the seat. Keep in mind that people have different frame geometries just like bikes. Height isn't the only thing that's important, but also inseam/leg length, upper body length, etc. Similarly, different styles of bikes might have an 18" seat tube but different lengths from seat to handlebars.