1. Create a new 165 x 165 pixel. Press D then X and fill the document with white. Then create a new layer, select the rectangular marquee tool and then make a button-like selection anywhere. With the selection still active Press D, then apply a stroke with settings [Width: 1px, Color: Black, Location: Center, other settings leave as default] and deselect. Now you may notice that your rectangle isn’t perfectly center, even though it doesn’t matter that much, you may visit this tutorial and center your button outline.

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2. Next select the pencil tool and use 1 px size brush, then draw in the corners similar to part 1. in the left picture. Then select the eraser tool and the tool bar at the top, make setting [Mode: pencil, Brush: 1px]. Now erase the outsides of the corner leaving a thin line that matches the rest, similar to part 2 of the picture to the left. Then select the paintbucket tool, choose a color of your choice, and click anywhere in the outline.

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3. Now select the pencil tool and make sure its brush size is 1px. Then select a lighter version of your button color, and draw it in the top and left, then choose a darker and do the same for the bottom and the right, this should give the illusion of light shining on it from the upper left.

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4. Finally we are going to add a drop shadow with THESE SETTINGS. Then you can add the text you wish and your done. Now you have a great little button.