Bicycle wheels have been produced in a bewildering variety of sizes over the years. Fortunately, the modern bike commuter only needs to be aware of the few sizes that are commonly in use today.
700C, aka 29 inch (622mm)
700C is the most common modern road bike wheel size. This size offers the widest selection of tires and other wheel components, the best compatibility across various bike brands and models, and comparatively low rolling resistance. Drawbacks include difficulties associated with designing small frames around big wheels, and slightly less toughness than smaller wheels. In mountain biking circles, 700C wheels are called “29 inch”.
26 inch (559mm)
26 inch is the standard mountain bike and cruiser wheel size. As you might expect, a broad selection of strong rims and wide tires are available in this size. We’re starting to see more utility and cargo bikes designed around this smaller wheel (for example, my Civia Loring uses 26 inch wheels). Advantages include the ease of building smaller frames around this size, and generally higher strength due to the smaller diameter. When used with narrow, high pressure tires, 26 inch wheels can sometimes provide a harsh ride.
650B is an old French wheel size that was popular in that country for use on touring bikes and tandems. It was never widely used here in the U.S. though it’s seeing a bit of a resurgence due primarily to being promoted by Grant Petersen, Jan Heine, and the late Sheldon Brown. At 584mm, the 650B size essentially splits the difference between 700C and 26 inch. It’s a good choice for smaller frame sizes (for example, Michael’s Rivendell Betty Foy uses 650B wheels). Though there are some very nice tires being manufactured in the 650B size, the overall selection is severely limited in comparison to 700C and 26 inch. 700C road bikes with limited tire clearance are sometimes converted to 650B which allows for the use of wider tires.
Small Wheels (16”/349mm, 20”/406mm)
Small wheels are used on folding bikes and mini velos. They enable bike designers to build compact bikes that are easy to take on public transit and store in small spaces. 16 inch and 20 inch wheels tend to provide a harsh ride, hence the fairly common use of suspension on bikes spec’d with these wheels.
For a comprehensive list of the wide range of wheel sizes produced over the years, see Sheldon Brown’s page on Tire Sizing Systems.