From 40tude Dialog Wiki
Since I'm aware that this feature might attract a few people and it actually is a bit hidden and not yet documented in the help file, here is my 60 seconds intro to "Categories" in Dialog (you'll need Beta 25, build 188.8.131.52 or later for this).
One of the most wanted features was being able to have folders in folders. More generally, you asked for a way to organize groups and folders apart from simply having them on the Subscribed tab in a defined order.
I did not implement a tree like structure, but you can now have category tabs above the newsgroup list. Besides the pre-defined tabs Subscribed, All, New, Folders and Filtered you can create more tabs and select which groups/folders should be present on these.
First create one or more custom categories (=tabs). Select Groups->Categories->Manage categories from the main menu, click the New button and enter a descriptive name for the new category. Close that window, select some groups/folders in the newsgroup list, and select the category you just created from the Groups->Categories menu. The select groups/folders should now be available on the new category tab.
Note that some commands now work depending on which tab is active. E.g. when you do a Get new headers in subscribed groups while the Subscribed, All, New, Folders or Filtered tab is active, Dialog will actually get new headers in the subscribed groups. If however a category tab is active it will only get new headers for the groups in that category. The same applies to Mark all groups read.