Since update to Oreo, desktop folders no longer work.

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Android Central Question

While running my Pixel C with Android Nougat, long- pressing an app icon on the desktop and then dragging it over another icon created a folder containing both apps. The resultant folder could be custom-,named. Once the folder was created, additional apps (and/or internet shortcuts) could be dragged into the same folder. As it came from the factory, preloaded folders contained as many as five apps.

With Google "upgrade" if my Android OS to Oreo, this operation no longer works. Pressing and holding an icon shrinks the home screen to display the widgets tool, etc. Dragging an icon over another simply causes the lower icon to move around, dodging the one you are dragging until you lift your finger. No folder is created.
 
I can still create folders and put other icons in my existing folders, but I can't name the folders anymore.
 
I get the same behaviour as in the top post. Also, this hasn't changed with 8.1.

I hadn't tried to put anything in a desktop folder for a while and so hadn't noticed the bug. Of course, now I've seen it I find it frustrating - although I think I can live with it.
 
You need to drag the icon in from the left side of the target icon/folder. If you try to "enter" the target icon/folder from any side other than left, they will just switch places
 
Yes, that was the answer I got when I raised the issue on Google's Nexus Help Forum (for the Pixel C you need to go to the Nexus forum rather than the Pixel forum - not obvious, but there it is). You may need a couple of tries for this to work - you need to be quite precise about when to release the dragged icon. With a bit of patience it works, and in my experience you can then name a new folder.
 

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