A new report, Rising to the Challenge, urges fire services in England to follow cash-cutting examples in Merseyside and Greater Manchester.
The report says "the best services" prove it is possible to save money without jeopardising standards of cover by changing shift patterns or cutting the number of staff on duty when fires are least likely.
Some services reassessed the need for night duty in stations where call outs were infrequent.
The report concludes that if others followed suit they could save up to£150m a year.
The rest of the savings (£50m) could be made by using cheaper, smaller appliances, reducing false alarms, cutting days lost through sickness and working more closely with neighbouring fire services, councils, police forces and other local bodies.
Audit Commission chairman, Michael O’Higgins, said: "There is no doubt that firefighters do a great job but the best services have shown they can respond to incidents more efficiently without jeopardising safety. The rest must follow their example."