There are many methods to creating rust in Photoshop. Here is one way to make rusted type. We can make our text look weathered with a little effort.
Start with some test on a new layer.
Rasterize the type, by right clicking on the name on the layer thumbnail and selecting "rasterize text" (Render type in PS 5.0 and 5.5)
Select the text (Ctrl/Cmd+Click on layer thumbnail)
Select the linear gradient tool and choose the "copper gradient" fill the text with the gradient.
the color of the text by using the Hue/Saturation option. Press Crtl/Cmd+U
to open the command and set it for a gray/blue color.
Duplicate the layer.
To add the texture:
Shoose the settings as shown to the right.
Switch to Difference mode and notice how the color begins to come out.
Now load the layer as a selection by Cmd/Ctrl+Clicking on the layer thumbnail.
Select>Modify Contract Choose 4 pixels.
In the bottom of the toolbox click on the quickmask button, or press the "Q" key
Choose the settings shown.
Click off the quickmask tool or press "Q" again.
Duplicate the layer
Press the Delete/backspace key to delete the selection.
Switch to color dodge mode.
Add an inner bevel to the layer.
Also add a drop shadow to the original text layer for effect.
Here is the effect with a shiny border, for a variation please continue.
Change the mode to Saturation
Ctrl/Cmd+U for the Hue/Saturation
Change the color to suit
Drop onto a colored background for effect.
There you have it... Rusted Text. Rust never sleeps! (And neither does Colin these days :)
For more cool techniques like this on an easy to follow video format check out Photoshop Secrets Special FX photoshopCD.com