Click on the posts menu item from the left-hand sidebar and then click on categories. Categories provide a way to organize content according to subject matter. They can have a hierarchy where you can specify parent categories. For example, you could create a parent category, website themes, and then create other categories such as corporate, and specify it as the parent. You can add new categories by adding a name, slug, or URL-friendly version of the name. Select a parent category and enter a description for it. Then press the add new category button. On the right hand side, you will see a list of all the categories available in the system along with info such as the description, slug, and posts. Clicking on the number in the posts column will take you to the posts page where you will see a list of posts assigned to this category. Hovering your mouse over any of the items in the list will bring up a list of options. Clicking on either the category name or the edit option will take you to the edit page of that category. Here you can easily edit the category by modifying the name or slug, specify a parent category, or a description. Then click on the update button to save your changes.