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To create a drop-down list in Excel, first, input the items you want in a separate sheet. Then, select the cells where you want the list to appear and go to Data Validation. Choose "List" for Allow, select the source items, and click OK to create the list. Alternatively, type the items directly in the Source field separated by commas. You can also use named ranges. Once set up, you can easily select items from the drop-down list. Give it a try now!