After further investigation I found out how to Edit the Friend List. But it is not very intuitive.

UI IMPROVEMENT SUGGESTION: Perhaps add the pencil edit icon next to the List Name so it would make it more clear and easier to identify that the list can be edited, rather than having to clicking on the List Name to Bring up the Manage List pop-down menu so one can perform tasks on the List?

Screencast: http://screencast.com/t/GspOWywluJmz

Thanks for the heads up on this Randall but we did thought about adding an edit icon beside the list title but this will only cause the title to show only a small fragment of the title because of the "width" area on the left sidebar.

Can you add a Tooltip to the Title for the List header? Click List name to Edit or Manage List.