Back to Dye Printing Tricks & Tips
If the resolution is too low, no font will work well. Photoshop is not really the best program for setting type. Especially if you want to set a lot of text. I've found it better to create your Photoshop backgrounds and art, a few special effect headlines etc., then make an EPS or TIFF and place that file in a layout program like PageMaker, InDesign, or Quark. FreeHand and Illustrator are also making great gains for layout abilities.
If your Photoshop document is started at a low resolution (72 dpi for example), any text set in that document will image to film poorly. Note the example below. The screen view appears pretty nice, but look at the blow up; its rough and bitmappy.
To beat this system newer versions of Photoshop will preserve vector-based information like font creation. If you have an old version of Photoshop, you'll have to set the document dimensions to a high resolution (1200dpi). Do this before you start any other work (>File>New, see "Resolution"). If you don't know your document's dimensions you can check the resolution easily (>Image>Image Size).
Of course, the higher the resolution, the larger and more ungainly the file will become. If you don't want to try various filters, special effects, and burning to CD a 185 megabyte file, set the text in a layout program.