Overdrive on a truck? And better gas mileage?

ok so i have an automatic 98 ford ranger and theres a on that turns off overdrive. is overdrive supposed to be on or off? because when you turn it off thats when the light goes on which makes me think that it is not a default setting. what does it do and will get better gas mileage if i dont use it. also are there any tips on getting better mpg?