The Folder List is normally in alphabetical order. In Outlook 2010 and up, the Inbox, Drafts, Sent Items, and Deleted Items folders are grouped at the top of the folder list, with the user-created folders sorted alphabetically below. Beginning with Outlook 2013, you can arrange folders in any order (or lock then in alphabetical order).
Outlook 2013 and up
Beginning with Outlook 2013, you can arrange your folders in the folder list in any order you want. This is a change in behavior from older versions.
Select a folder and drag to a new position or right-click and use the Move Up and Move Down commands.
If Move Up and Move Down are missing from the menu, you have the folders locked in alphabetical order. Go to the Folder tab and click on Show All folders A-Z to turn this off.
To reset the Mailbox folder list to alphabetical order (with Inbox, Drafts, Sent and Deleted items grouped at the top), click the Show All Folders A to Z button on the Folder tab. When this button is highlighted, the folders will sort in alphabetical order. When it’s off, the sort order returns to the previous order.
When the folders are in random order and you want to sort them in alphabetical order and retain the ability to move the folder, right click on the mailbox name and choose Sort Subfolders A-Z. This sorts the folders in alphabetical order; it is not a toggle that flips between your previous unsorted order and alphabetical.
To sort subfolder of another folder (such as your Inbox), right click on the folder and choose Sort Subfolders A-Z. Note: if there are no subfolders within a folder, the command is grayed.
Outlook 2010
In Outlook 2010 the Inbox, Drafts, Sent Items, and Deleted Items folders are listed first with the remaining default folders and the user-created folders following in alphabetical order.
The folders in the Favorites list in the Mail module, and in the Calendar, Contacts, Tasks, and Notes modules can be arranged in any order. Drag or right-click and use the Move up and Move down commands.
Outlook on the web
Folders are sorted in alphabetical order in Outlook on the web. As of this writing, you cannot change the sort order in the folder list. If you want to use a specific order, add the folders to the Favorites section at the top of the folder list by right-clicking on a folder and choosing Add to Favorites. Either drag up or down to change the folder order or right click and use the Move up the list or Move down the list commands.
Remove folders from the list by right-clicking and choosing Remove from Favorites.