Got this bike for free. I want to upgrade it little by little. what are the upgrades that will give me the most improvement in ride quality.

Getting the bike fit dialed in will make a bigger difference than anything else, by like 100x. Watch some tutorials from professional bike fitters, and expect it to be a thing you continue to work on for a while before you really feel like you’ve got it right, you might want to invest in an adjustable stem to play around with handlebar height and reach, find out exactly where you want your bars, then buy a rigid stem to match that positioning

After that, contact points and tires make the most difference – the bars, pedals, and seat all look decent enough, you might find ones you like more that motivate you to upgrade, but none of these seem obviously terrible in the photo.

Can’t really tell what tires those are, or even what condition they’re in from the photo – one shot makes them look pretty run down, but that might just be the lighting. Either way, if they’re anything other than good quality tires in decent condition, I’d start there in terms of upgrades.

I also can’t tell how long those cranks are, but if they’re anything longer than 165mm there’s a good chance you’d benefit from swapping to a shorter set – exactly how short depends on your body and preferences, but people tend to favor shorter cranks of fixed gear’s because it gives better clearance while pedaling through corners and reduced toe overlap with the front wheel, plus the whole cycling world is gradually moving to shorter cranks as people realize the 170mm cranks most bikes ship with are actually too long for like 80% of riders.

You could also consider changing the gearing, I can’t tell exactly what size chainrings you’ve got on there, but you didn’t pick them out so there’s a good chance they aren’t exactly what you’d like most. Ride it a while as-is though to get a feel for things.