“My Library” holds every item in your library. To organize these items, you can create collections and subcollections on the left side of the Zotero window. Note that items can belong to multiple collections; it is best to think of collections as more like “playlists” than like folders on your computer. To add a new collection, click on the “New Collection…” icon at the top-left of the Zotero window or right-click on the left Zotero pane. To make a subcollection, right-click on a collection and choose “New Subcollection…” or drag an existing collection into another collection. To rename a collection, right-click on it (control-click on Macs) and select “Rename Collection…” To add items to a collection, drag them from the middle pane.
You can also organize your collection through tags. Click on an item in the middle pane. Now select the “Tags” tab in the right pane. Click “Add”, type the tag name, and type Enter/Return. To add multiple tags at once, type Shift+Enter/Return. Enter each tag on a new line, then type Shift+Enter/Return again to add all of the tags at once. To filter your library or a collection on a tag, select the tag from the tag selector pane in the lower-left of the Zotero window. You can also drag items from the center pane to a tag in the tag selector to add the tag to all selected items.
See Collections and Tags for more information.