Frequency references are indispensable to radio, microwave and time keeping systems, with far reaching applications in navigation, communication, remote sensing and basic science. Over the past decade, there has been an optical revolution in time keeping and microwave generation that promises to ultimately impact all of these areas. Indeed, the most precise clocks and lowest noise microwave signals are now based on a laser with short-term stability derived from a reference cavity. In spite of the tremendous progress, these systems remain essentially laboratory devices and there is interest in their miniaturization, even towards on-chip systems. Here we describe a chip-based optical reference cavity that uses spatial averaging of thermorefractive noise to enhance resonator stability. Stabilized fibre lasers exhibit relative Allan deviation of 3.9 x 10(-13) at 400 mu s averaging time and an effective linewidth <100 Hz by achieving over 26 dB of phase-noise reduction.