A family of Microsoft spreadsheet software with tools for analyzing, charting, and communicating data.
Uncheck "Show error alert when invalid data entered"
If you want the free form entry to become a permanent member of the dropdown list you must employ VBA event code.
The code and a sample workbook can be found at Debra Dalgleish's site if interested.
http://www.contextures.on.ca/excel-data-validation-add.html
Gord