When I create directory tests and right click > select "Mark Directory as" I see only 1 option Excluded. Using latest IJ

Okay for those who have the same problem, I've figured it out in my case (partly due to the answer Fahad gave, so thank you Fahad!). So it turned out the 'java-unittesting-vendingmachine' folder was marked as Source Root.

All you have to do is unmark it and you can then mark 'src' as Sources Root and 'tests' as Test Sources Root

hi Ali Baig , if try to Mark Directory any folder inside resources folder or source folder like (src/main/java/any folder) it will show only Excluded.

Here's my directory structure (using the Maven style):

vending-machine <-- module (content root)
├── src
│   ├── main
│   │   └── java <-- sources root
│   │       └── io
│   │           └── github
│   │               └── adamelliotfields
│   │                   └── Main.java
│   └── test
│       └── java <-- test sources root
│           └── io
│               └── github
│                   └── adamelliotfields
│                       └── MainTest.java
└── vending-machine.iml

When starting a project in IntelliJ, it creates the src folder for you.

Go into terminal and generate the rest (assuming you are in the project root folder):

mkdir -p ./src/main/java/io/github/adamelliotfields

mkdir -p ./src/test/java/io/github/adamelliotfields

Then you can go into Project Structure and label your folders as you wish.

Finally, if you're using Maven or Gradle, it will generate all this automatically for you.