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Let's assume the cost of each of the first three tires is x.
According to the deal, Lydia pays $10 for the fourth tire.
So, the total cost of the four tires is x + x + x + $10 = $266.50.
Simplifying the equation, we get 3x + $10 = $266.50.
Subtracting $10 from both sides, we get 3x = $256.50.
Dividing both sides by 3, we get x = $85.50.
Therefore, the cost of each of the first three tires is $85.50.