Mail, Apple’s email client that ships with Mac OS X Lion, features colored flags that can be used to highlight and group messages. There are seven to choose from: Red, Orange, Yellow, Green, Blue, Purple and Grey. To assign a flag to a message, simply open the message and click the flag button in the toolbar. By default it will apply the currently-displayed color to that message. To select a different color, click the black disclosure triangle on the right (see below).
That’s great, but labels like “Red” and “Green” aren’t very descriptive. It would be better to apply a custom label, like “Soccer” or “Budget.” Fortunately, you can! Here’s how.
First, you must assign at least two different flags to (at least) two messages. Once that’s done, a “Reminders” area will appear among the mailboxes list on the left [1. If it’s not there already.]. Click the disclosure triangle to reveal a list of the message you’ve flagged (see below).
Next, right-click (or Control-click) on one of the flags and select “Rename Mailbox…” from the contextual menu. The flag’s name will then be ready to accept your edit! Type the new name, hit Return and you’re done.
Note that the message count depicted next to my green flag above (“4”) represents the number of messages with a green flag, not their read/unread state.