If you select Custom List as the UI type in your custom field setup, you can create a new customized list using the custom list screen.
For every new custom list you create, you can add number of items to be displayed in the drop-down that the users can then select from. For example, a custom list for a custom field can have items such as Location, Partners, Approval Date, etc. You can customize a custom field of time entry screens to Location to track the time entries of offices in different locations.
To access this screen, click the Custom List link under the Custom List drop-down list field on the Custom Labels screen.
The fields on the screen are:
List Name:
The drop-down displays list of custom lists created. The items in each selected list can be viewed and edited in the grid below.
When New is clicked, it displays a text box where the new list name can be entered.
The grid at the bottom displays the List Items, each item on a separate row. Click Save to save the changes made.
Click Delete 
to delete an item from a selected list.
Custom List Button Panel
Help:
Opens the Web Suite Help in the Custom List section.
Delete List:
Deletes the selected item list.
New:
Changes the List name drop-down to a text field where new list name can be added.
Save:
Saves the changes made to the list.
Cancel:
Cancels the changes made to the list, and displays the items in an list selected in the drop-down. You can change the items in a list from here.
Close:
Closes the Custom List screen.