1. First you must purchase or pick up a Scroll of Identify (Akara sells them). 2. In your Inventory (from the Tome as well), use the Scroll of Identify by holding the Use button. (A on Xbox). 3. Select the Unidentified Item using the Circular Arrow and press the Use button to identify it. 4. The Item's stats will be revealed. Deckard Cain can also identify items if he’s in your camp.