This is an optical illusion, because when the moon is on the horizon, your eye compares it to other things in your line of sight, such as buildings and trees. When it is higher in the sky, away from the other objects, then it looks smaller by comparison. Here's something you can try:
look at the rising moon, but use your hands to block out the other things in your line of sight, like houses, trees, telephone poles, etc, and it will look smaller to you - more like it does when it is high in the sky.

A great question.It turns out that this effect is an optical illusion. If you carefully take pictures of the moon when rising and when risen, you will find out that it is the same size! What apparently happens is that your eyes and brain compare the moon to trees and other objects on the horizon, making it look bigger when it is rising.

The short answer is that the moon is big -- but up in the sky there is nothing to compare it with. When it is on the horizon, you can see large buildings or mountains and the moon looks large in comparison. Another effect is the distortion of the moon's image by refraction of the air so that it looks wider and shorter than it really is.