Adobe Photoshop 7 Tutorials
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Creating Text Effect using Photoshop Layer > Effects.

by  Daniel Ledarney

Summary: File New ; create the text; Multiple Layer  Effects; save as a gif.

You may create a multitude of various very quick and easy text effects in photoshop using the it's
"layer effects"
and working with the various options.

1. Opening an new file (Ctrl-N).
Open your file to the size you wish. I used 125 px* by 60 px, bold,  50 pt  Arial Rounded MT. Create the text using the type tool and any foreground color. 
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2. Applying Layer Effects.
After creating the text with the appropriate color and size select  the layer > effects from the menu.  For the image on the right "Inner shadow" was used with the default settings. Notice how the shadows effect the image; it appears cut into the white background.

The image effect on the right was accomplished using Bevel and Emboss > style to Inner Bevel, depth > 3 and blur > 3.  A drop show was added using the default settings.

See if you figure out how to create the text image effect that was created on the right.  Clue--You can apply an effect to individual layers and combine them.  
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3. Saving the images.
Select image > mode > indexed (for the web) or other appropriate option.