How does tire size change performance and gas mileage in vehicles?

I have a 1986 Toyota Pickup 4 WD and I currently have 265 75 16 tires on the truck. I need new tires and I've been told that I could get smaller tires that would help on gas mileage and handling. How much improvement would I see on both mileage and performance?How does tire size change performance and gas mileage in vehicles?
Shorter and fatter tires get worse mileage. Taller skinnier tires get better mileage. Go from there.How does tire size change performance and gas mileage in vehicles?
not enough to shake your boat/smaller tires cut gas mileage/more rpms to go the same distance/large tires give slight improvement but hardly noticeable because it takes more energy to get to speed/stick with what the recommend its on the divers door pillar or glove boxHow does tire size change performance and gas mileage in vehicles?
Actually, it's the other way around. Larger tires get better mileage for one simple reason: for every revolution a tire makes, a larger tire has a larger circumference and therefore goes further.
A shorter tire will hurt your highway mileage .You will see a mild improvement in acceleration and perhaps a small increase in city economy with the lighter/shorter tire .