Mapping Center Answer:

An easy way to do this is to set the properties of the data frame to a coordinate sytem that uses feet (e.g., State Plane), draw the polygon in the data frame and then use the drawing toolbar to draw the shape around the polygon. Once you have drawn the shape, you can modify its dimensions to get the units you need. (e.g. a square of 100 ft. on each side to make a 100 sq. ft. polygon or a circle that is 100 sq. ft. so its radius is 5.64 ft. - or the diameter is 11.28).  Once you've drawn the polygon, right click the data frame and select the Convert Graphics to Features option.  Note that you will likely be then saving the polygon you draw in the coordinate system of the data frame, so if you project it to some other coordinate system, the shape of the feature will change.