As usual, we will start off with a blank canvas. We will choose the Pen tool and begin to draw a line we want the text to follow. We can either use the Freeform Pen tool, or the regular Pen tool. In this example, we will use the regular Pen tool and plot points. Once we reach our last point, we can press Escape to end the Path. It should look something like this:
Now we can choose the Convert Point tool (
) from underneath the Pen tools, and convert the points to curves, like so:
Now we can simply choose the Text tool and hover over the Path, you'll see the cursor change:
Now if we click while this cursor is showing, we can begin typing on our Path:
Now if we go into our Paths Panel, we will see we have two Paths, both with the same thumbnail. The second one, with the description of the text we input, is now its own Path - we can delete the original one and use the text one to modify, if we need to. However, we will keep the original, just in case.
We can also created more adventurous Paths that text will follow, like so:
Notice that when we delete the original Path from the Paths Panel, we are no longer able to see it on the canvas - just the text is left. However, if we export the image to GIF or JPEG, the Path will not be visible as it is only a guide and not an actual element in the page.
Once the text has been positioned with a path, it is still editable and will still follow the path. However, you can only modify the Path itself if the original is still in the Paths Panel (I.E. is still visible on the canvas). Like so:
Using this method is useful if you want text to follow around an object - all you need to do is trace the object with a Path, and then let the text follow it! You won't see the Path, just the text following it, which will look like the text wrapping to the object you trace.
More Tutorials: 
