Login in to Magento Admin.
Go to Products – Categories From Navigation
Click on “Add Subcategory” So it will create sub category of “Default Category”. You can create root category by click on “Add Root Category”.
Configure category data.
“Category Name” field is for category name.
“Include in menu field is for If you want to show category in fronted menu than enable “YES” or if not than disable “YES”.
“Enable Category” field for enable and disable category for magento.
You can see your category at front side home page Menu.