You can add text that uses attribute information from a feature layer to your map annotation by using the Label tool on the Draw toolbar.
- Specify the active annotation target on the Draw toolbar.
By default, text added to the data frame is added to the <Default> annotation group.
- Click the Label Manager button on the Labeling toolbar.
- Choose a label class under the layer you want to label.
- Click the Label Field drop-down arrow and click the attribute field you want to use as a label.
- Click OK.
- Click the Label tool on the Draw toolbar.
When in layout view, the Label tool is unavailable unless the data frame is focused. To focus the data frame, click the Focus Data Frame button on the Layout toolbar.
- Click Place label at position clicked.
- Click Choose a style and click the label style you want.
- Click the feature you want to label. If features conflict, the topmost feature will be labeled.
You may have to click the drop-down arrow to choose the Label tool.
If you click Automatically find best placement, ArcMap finds the best location for the label using the Label Engine that is specified for the data frame and the label properties that are set for the layer.