It's an optical illusion. If you actually measure the sun/moon width at
sunset
or sunrise, and compare it with the measured width at midday, you will find
it
is exactly the same.

Distortion of the sun and moon near the horizon is due to varying atmospheric
densities, this does not make the sun or moon look any bigger.

Martin

This is all correct except for the bit about the moon being the same
size. Interestingly enough, it's actually smaller when near the horizon than
when high in the sky.
Imagine a plane through the centre of the earth at right angles to
the line joining the centres of earth and moon. Where that plane cuts the
surface of the earth the moon will be on the horizon. But if you see the moon
high in the sky you must be on that part of the earth that bulges towards the
moon, which is therefore closer to you than it was if you viewed the moon just
rising or setting. The closest you can get to the moon is when it is overhead.
The maximum value of this effect is about 1.8%. For the sun, being much
further away, the effect is negligible. In any case, all this is quite swamped
by the optical illusion we've been talking about.

Tudor Hughes, Warlingham, Surrey.