Hint: If you've never touched git before, it's easier to learn by tinkering with an existing repository, which is described in the next section.
Git tracks all of the files which are contained by a folder (including sub-directories, sub-sub-directories, etc). The first step when you create a new project is to pick the root folder. I'll be using the source code to this repository as an example, but you can use whatever folder you'd like to start tracking. Drag the folder to the DiffManager, then
right-click -> Git -> Create new.
Now that you've got an empty repository, you can start making commits.
Hint: You can't put a git repository inside another repository. If you don't see
Create new as an option, you're probably inside an existing repository, and you need to move up to a higher folder.