We derive an equation that governs the spatiotemporal dynamics of small amplitude alternans in paced cardiac tissue. We show that a pattern-forming linear instability leads to the spontaneous formation of stationary or traveling waves whose nodes divide the tissue into regions with opposite phase of oscillation of action potential duration. This instability is important because it creates dynamically a heterogeneous electrical substrate for the formation of conduction blocks and the induction of fibrillation if the tissue size exceeds a fraction of the pattern wavelength. We derive an analytical expression for this wavelength as a function of three basic length scales related to dispersion and intercellular electrical coupling.