The wireless radio-frequency identification (RFID) picocellular system includes a central control station optically coupled to one or more electrical-optical (E-O) access point devices that generate the individual picocells. The central control station includes service units that provide conventional wireless cellular services, and further includes one or more RFID reader units. The E-O access point devices are adapted to receive electromagnetic RFID tag signals from RFID tags within the associated picocell and transmit optical RFID tag signals to the central control station, which converts the optical RFID tag signals to electrical RFID tag signals, which are then received by the one or more RFID reader units. The system allows for large numbers of RFID tags in the picocellular coverage area to be quickly read and the information stored. The relatively small size of picocells allows for high-precision locating and position tracking of items without the need for manually scanning RFID tags with an RFID reader.