Method 1A simple way to bring life to text is to warp it. Warping text is easy. Firstly open up Photoshop, click on the 'T' icon on the tools window (on the left), drag a box big enough for your text and type in any text you want. Then, still with the 'T' icon selected, right click on your text and click on 'warp text...'. The style is currently on 'none' but using the drop down box you can choose from various styles such as 'arc' (left), 'fisheye' (middle) and 'squeeze' (right).
Once you have selected a style, you can change the bend and horizontal/vertical distortion. Click 'OK' when you have finished.
Method 2Creating paths is an excellent way of adding a personal touch to some text. Enter your text as in method 1 using the 'T' icon on tools window.
With your text layer selected go to Layer > Type > Create Work Path. You can now delete your text layer or make it invisible - on the layers window (bottom right) find the layer with your text and click on the eye next to it.
Now select the Direct Selection Tool on the tools window (it looks like a white cursor) and you can edit your text by dragging the points. You can use this to create 'mutated' shapes and alter the length of your letters. Below I have elongated the 'p' by clicking on it and dragging the points across.
Once you have finished editing, go to the Layers window and click on the new layer button (on the bottom, second from the right). Now click on the Paths tab and select the path named 'Work Path'.
To fill the path click on the circular icon on the bottom left of the Path window. This will fill your text with your foreground colour. To change the colour simply click on the large icon on the tools window (entitled 'Set foreground color').
Finally you can delete the path by right clicking on it and selecting 'Delete Path'.
Below is an example of what your text should look like.