Simulate Circular Text on a Path: Using Vector Mask

1. To begin this tutorial, start a new document (I used 450 x 450).

Select the 'Background Layer' in the Layers Palette, then hit 'Ctrl + R' to show the Ruler Bar's (If not already visible)

Then drag a Horizontal and Vertical Guide from the Ruler Bar to meet at the center point of the new document.

TIP: Make sure 'View/Snap' is turned on. Then drag the guides SLOWLY and you will notice that the guide will automatically find the center point of the document.(Applies only to the background layer and individual layers)

2. Next Select the 'Ellipse Tool (U)' from the Tool Bar and (Hold 'Shift' key) drag a circle onto your document.(Foreground color of your choice).

Then position that new Circle Shape layer to the centre of your document.

(Follow the TIP in step 1 to find the exact centre.)

3. Next, Select the 'Type Tool (T)' from the Tool Bar and type the necessary words you want to add to the circle.

This should be on its own layer.

4. Next, with the text layer selected in the 'Layers Palette', go to 'Layer/Type/Convert to Shape' as I have captured to the right.

This will break up the text into individual letter shapes.

An alternative & tedious to this step is to create individual letter text layers.

The advantage of doing it this way is only a single layer is used for all of the individual text shapes.
The disadvantage is that the text is no longer editable.(As I have captured below)

5. Next, Ctrl + click on the Ellipse Shape layer you drew earlier and drag and additional Guide to lock to the very top of the the Shape as I have captured to the right.

Then, select the 'Path Select Tool (A)' from the Toolbar. Click on the first letter (In this case 'T') and position it at upper most Horizonatal Guide and to the center of the Vertical Guide.(As I have captured to the right)

6. Here's the crunch of this tutorial.

With the 'Path Select Tool (A)' still active on the Tool Bar, right click on the 'T' letter shape and from the list choose 'Free Transform Path'.

7. I've zoomed in to show you what's important here.

Besides the end anchor points, theres a center/focal point (circled in red & looks like a 'Cross Hair' symbol) which allows positioning of paths in relation to other objects.

TIP Right click again, and you will see the Transform options available.

8. Next, (Hold 'Shift' key) click & drag that center/focal anchor to the the exact center of your document as I have captured to the right.

9. (Still in Free transform Mode) go up to the 'T' shape and move your cursor just around the parameters of the bounding anchor points until you see the 'Rotate' arrows as I have captured to the right.

Alternatively, right click on the 'T' shape and choose 'Rotate'.)

10. Then to complete the rotation drag downward in the direction of my red arrow as I have captured to the right.

11. Then start with the next letter, and repeat process from steps 6 to 10 to get all the letters on the curve.

12. Ok, so your first attempt is never gonna be perfect. As you can see, the whole phrase is not centered.

Do I have to start all over again? No!

We will apply the same trick to the whole phrase.
To do so, make sure the text shape layer is selected in the 'Layers Palette' and the 'Path Seletion Tool (A)' is active on the Tool Bar.

A. Start to click & drag (roughtly where I have the red dot) and end it until all the shape letters are inside the 'Path Selection' bounding area.

B. Now all the letters are selected.

13. (Same as step 6) Now, right click anywhere along the selected shape path letters, and from the drop dow choose, 'Free Transform Path'.(As I have captured to the right)

14. (Same as step 8) Drag the centre anchor (as I have circled in red) to the center of your document.

15. (Same as step 9 & 10) Then position your cursor around the bounding transform anchors til you see the 'Rotate' arrows (or right click and choose 'Rotate' from the drop list options) and adjust the whole phrase to a centered postion that you are most comfortable with.

Hope you enjoyed this tutorial.