Reducing an Image Size without Losing its Quality

You cannot avoid losing quality when reducing the size of an image; one can hope only to mitigate the quality loss.

When resizing images in Photoshop, the default is to use a softer Bicubic sampler; the comment above to use the Bicubic Sharper would be a good start. It is not, however, always appropriate for all images.

Second, I suggest sticking to multiples of the image width and height. For example, if your original image is 1000x1000, you should get very acceptable results at 250x250, 500x500, 750x750. 398x398, however, is apt to look a bit more blurry.

Hope that helps.

Size in pixels or size in bytes?

If you want it reduced in bytes:

Go to save for web and device from file menu. This option won't play with your image. It just reduces the size to some extent to make it appropriate for the web.

If you want to reduce its size in pixels:

Create a document of your desired size, for example, 400×400. Now, drag your desired layer/image to this new document, then press CTRL+T. Just match the corners from transform corners, it won't look blurred. And if you're going to make an image of 400×400 to 200×200, it will loose its quality for sure.

Try this.

Before resizing , convert it into smart object.

Right click on the layer of the image ---> Convert it into Smart Object

then resize the smart object using Free Transform tool.

I found it helpful. But there would be a bit of a compromise in image quality.

Note: Do your edit work on the image before you go to smart object. Else you have to raster it again will sure be a loss in quality.