This is what I found to reduce code size the most for the 8bit AVR MCU:

    [profile.release]
    opt-level = "z"
    lto = true
    overflow-checks = false
    codegen-units = 1
    debug = false

Also invoking cargo with: cargo build --release -Z build-std=core -Z build-std-features=panic_immediate_abort

You must then implement panic handling yourself:

    pub mod std {
        #[lang = "eh_personality"]
        #[no_mangle]
        pub unsafe extern "C" fn rust_eh_personality() -> () {}

        // panic can be replaced by abort with the panic_immediate_abort feature.
        // -Z build-std-features=panic_immediate_abort
        // This saves space by getting rid of the unwinding.
        #[panic_handler]
        pub unsafe fn panic_impl(_info: &::core::panic::PanicInfo) -> ! {
            loop {}
        }

        #[no_mangle]
        pub unsafe extern "C" fn abort() {
            // blink led
            loop {}
        }
    }

If I still have some room in the flash, I will make some led blink with a noticable pattern on abort.

You can also experiment with the inlining threshold:

    export RUSTFLAGS+=-C inline-threshold=0