Editable type automatically appears on a new layer, each time you use the text tool. Choose the Horizontal Type tool (8th row, on right, a large T) or the Vertical Type tool (under the Horizontal Type tool).
To highlight text characters for editing, click a type layer, choose the Horizontal or Vertical Type tool, click in the type to create an insertion point, and then drag to select the the text you want to select. There are various shortcuts to select a word, a line, a paragraph, etc. To select all the type on a layer, double click the T icon on the appropriate layer on the Layers panel.
After the text is selected, you can edit the text of change the family, style, etc. To accept these changes, you can click the check mark on the Options bar, hit Enter on keyboard, click a different layer or click a different tool. Escape will cancel your changes.
If you want to make the bounding box for the text visible, choose the Move tool, click the type layer on the Layers panel, and check Show Transform Controls on the Options bar.
Kerning affects the spacing between a pair of text characters whereas tracking afffects the spacing among multiple characters. To apply kerning, double click the T icon on the layers panel, create an insertion point, and show the Character panel. From the kerning menu (3rd drop down, on left) you can specify a kerning value. To apply tracking, to an entire layer, just click the layer, to apply to part of a layer, double click the T icon and then select the characters you want. The tracking menu is the 3rd drop down on the right.
Leading affects how much space separates each line of text from the line above it. Typically one sets the leading for the entire line or a block of text; if set at the character level, the highest leading in the line applies. The leading menu is the second drop down, on the right, above the tracking menu. The Auto setting for leading is calculated as a percentage of the font size. The default is 120% of the font size and is set by choosing Justification at the top of the Paragraph panel menu.
On the Layers panel, double click the T icon then select the characters you want to shift. On the Character panel, enter a value into the Baseline Shift box (2nd textbox on left or use the icon as a slider by holding down the Alt key and dragging. Positive values raise it above the normal baseline or path, negative values beneath it.
Right click the layer name, and then choose the Horizontal or Vertical. To rotate vertical text a different way, double click theT icon (and select the characters you want if you don't want to rotate them all), then uncheck Standard Roman Vertical Alignment from the top right of the Character menu.
In the Layers panel, double click a T icon and then click in the desired paragraph or selected a series of paragraphs; to modify all the type in a layer, just click the layer. In the Paragraph panel, the alignment buttons are the first three on the left -- these align type to an edge or the center of the type bounding box. The second group, the justify buttons, force all but the last line to span the full width of the bounding box. The last button, Justify All, forces all lines, including the last line, to span the full width of the bounding box. The hyphenate box at the bottom of the panel enables automatic hyphenation, thus minimizing gaps that would occur between words.
On the Layers panel, double click the T icon and then change the shape of the bounding box.
Do either of the following: Double click a T icon on the Layers panel and then choose the Warp Text button on the Options bar or right click an editable type layer and choose Warp Text. Choose a style, orientation, and move any of the sliders.
It is necessary to rasterize type to apply a filter or the Transform>Distort or Perspective command to type, or to draw strokes on type with a tool such as the Brush tool. Once rasterized, you can't change the typographic attributes of the text. To rasterize, right click the layer name and choose Rasterize Type.
Ctrl-click the type layer thumbnail and then hide the type layer by clicking the visibility icon. Click the image layer to which you want to add the mask:
To reposition the type shapes within the layer mask, unlink the layer mask from the layer by clicking the link icon, then drag with the Move tool, restoring the link when done.
Click an editable type layer. On the Masks panel, click the Add Pixel Mask button. Choose the Gradient tool. Click the Foreground to Background preset in the picker, click the Linear gradient, choose Mode: Normal and 100% Opacity. In the document window, drag vertically or horizontally in the document window from the middle of the type to one of its edges. The type layer amsk will fill with a white-to-black gradient and the type will be hidden where black is present in the Layer mask. On the Masks panel, lower the Density value to reveal more of the type.
A lightened version of the image will be visible within the type shapes. Use a document with an image layer and and editable type layer, preferably in a large point size in a bold or black style. On the Layers panel, Ctrl-click the T icon, hide the type layer, and then clicking the underlying image layers. On the Adjustments panel, click the Levels button, Move the gray Input levels (midtones) to the left to lighten the midtones int he tuype. Move the Output levels slider to the right to reduce the amount of contrast in the type. To screen back the imagery, instead of screening back the type, click the Levels adjustment layer and on the Masks panel click Invert.
Source: Photoshop CS4 Visual Quickstart Guide, Elaine Weinmann and Peter Lourekas, pp. pp. 351-367