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Provincetown is definitely a walking town. Once you arrive, you'll want to park your car at one of the parking lots or in a metered space. The entire shopping/dining area of the town is compacted into an approximate 2-mile strip, so it won't take you long to walk wherever you're going if you're on a schedule, or you can easily spend the afternoon meandering from shop to shop and never leave the main street, Commercial Street.
Commerical Street is very narrow and allows only one way traffic. The sidewalks are also narrow (if they exist at all!), but the cars and trucks move slowly and are very accomodating to pedestrians.
If you want to take a tour or rest up from walking, trolleys run up Commerical and parallell in the other direction down Bradford Street (a block or so over). You can hop on and off all day for a nominal fee.