Changing Max Players & View Distance
These three settings live in server.properties and have a big impact on both how your server plays and how much load it puts on your hardware. Restart your server after changing any of them.
Max Players
max-players=20
This sets how many players can be connected at the same time. Raising it lets more people join, but each additional player uses memory and CPU, so only set this as high as your server can comfortably handle.
View Distance
view-distance=10
This controls how many chunks the server sends out around each player, effectively how far players can see. It's one of the biggest factors in server performance. A value of 6–8 is a good balance for busy servers; 10 is the vanilla default.
Simulation Distance
simulation-distance=10
This controls how many chunks around each player stay actively ticking, where mobs move, crops grow, and redstone runs. Lowering it (e.g. to 6) can dramatically reduce lag without changing how far players can see.
View distance and simulation distance are separate. You can keep view distance high so the world looks good, while lowering simulation distance to save performance.