Your text field holding family names should be a stored indexed field--and indexing turns on automatically when you unless you specifically select otherwise for the field--so that's unlikely to be the cause here...
I'm not sure I follow your description on how you are setting up your value list. Compare what you've done to these steps.
Select Manage | Value Lists... from the File menu
Click the Use Values from field option
Select your Families table from the drop down and click the Family field to highlight it.
Leave all other settings in their default settings and click OK.
Enter Layout and select the field on your Collections layout you want to format.
Use the Inspector pallet to specify a drop down list, pop-up menu, check boxes or radio buttons
Select the value list you created in Manage | Value Lists...
Return to Browse mode and test
Pardon my sparse initial message. I am following the help FMP11 tutorial and it matches with your guidance. The problem begins on the Inspector as I select to define a new "Value From" and the Manage Values for "Collections" opens to allow for an new list creation.
The Edit Value window opens and I type in a new name for the list and click the second choice (use value from another file). The "unknown" drop down is activated and I am able to select the table. The table only has one field of data. Here is where the problem stops all progress. The value list dos not display my field choices, and the "OK" button remains grey.
I was able to get it to work with an .xls import to a table, but not when I create a table by hand. I am using Win XP with FMP11.
There's the problem: "and click the second choice (use value from another file). " the second choice use a value list from another file. You use that when you have already defined a value list in a separate file (not a table.)
I am suggesting you use the first option to specify a value from a field. That draws values directly from a field--not a value list defined in another file.
I also discovered that if I converted data from an .xls file, it will create the index. If I build the table, it does not default to index on condition. Thanks for pointing me in the right direction. I also appreciate the other great advice on other ways to streamline the data entry using Value Lists with secondary information.
Unless you specify otherwise, indexing will be enabled on an "as needed" basis.
Using a field as the source field for a value list is one of those actions that will turn on indexing. Using it to define a relationship is another.