The described technology is generally directed towards selecting, by user equipment, a selected maximum transmission unit (MTU) packet size for wireless data transfer based on radio signal conditions. In one aspect, reference signal received power (RSRP) and reference signal received quality (RSRQ) are used to select the MTU packet size, e.g., by using RSRP and RSRQ as indices to a lookup table of predetermined MTU packet sizes, such as previously determined by field testing. In general, smaller MTU packet sizes are used with poorer quality radio signal conditions. The selected MTU packet size may be increased or decreased based on actual performance data and/or based on changed radio signal conditions, such as for a subsequent data transfer session. The user equipment may comprise a Cat-M device that transfers data related to Machine-Type Communications (MTC)/Machine to Machine (M2M) communications.