Problem with translating posted in

I have problem with translations - I managed to translate everything to my language ("Home link text", "Read more text", "Text of search result" etc.) however when I try to trnslate "Text before categories" nothing happens. On my site there is still "Posted in <category>" text.

Hi!
To fix this you have to edit the code in the file theloop.php:

//Post meta (comments, date, categories)
			if (!is_page()) {?><p class='post-meta'>
			
				<span class='post-date'><?php echo get_the_date(); ?></span> 
				
				Posted in &nbsp;<?php the_category(', '); 
				
				edit_post_link( $SMTheme->_( 'edit' ), '     |     <span class="edit-link">', '</span>' );
				
				if(comments_open( get_the_ID() ))  {
                    ?>&nbsp;<span class='post-comments'><?php comments_popup_link( $SMTheme->_( 'noresponses' ), $SMTheme->_( 'oneresponse' ), $SMTheme->_( 'multiresponse' ) ); ?></span>
				<?php } ?>
				
			</p><?php } ?>

You have to change "Posted in" in this code.

Thank you.

Another problem appeared. I don't know when it happened exactly, but now instead of categories I can only see the main category "Strona główna", and something you could translate to "no category". When I create a category it doesn't appear at the upper bar.

I hope this image can help
http://i39.tinypic.com/2hfnk78.jpg

I can't edit so I have to post again. Recently I've installed Yoast WordPress SEO, maybe that's the cause of problems?

Hi!
You have to customize your menu on page Appearance => Menus.
Here are the intelligible instructions:
http://codex.wordpress.org/WordPress_Menu_User_Guide.