Too many photos

I have a fairly common issue. I love how the photos are managed in Photos, but I have too many of them, collected during the years (and the situation will only get worse). I have a 256GB Macbook air M1, and probably more than 256GB of pictures.

I thought I can have as many photos in iCloud as the storage allows, but I think I'm constrained by the size of the laptop. I'm very puzzled since it means that I can have as many photos as the smallest of my devices. Am I correct? is there an alternative option?

Thanks!

Solution 1:

Go to Photos app > Preferences > enable Optimize Mac Storage. That will add caching features that seamlessly remove older photos locally when running out of space. You won't notice a difference, basically.