Photograph Works

Here is a way to make grungy type using displacement maps in photoshop.

Create a photoshop file of something interesting (see below) and save as an 8bit psd. Call it popsicle.psd (well you have to call it something).
Type your text. It will be a layer in your psd file.
Go to filter/distort/displace
A box will come up to tell you that your text will be rasterized. Click OK
Now you in the displacement dialogue box.
Follow the instructions. You have to choose some values. The default values are modest. If your file and your typeface are big, you may find that you can choose much bigger values in the dialog box.
Choose popsicle.psd as the displacement map file.
Look at the results.
Don’t like it? Undo and try again with different values.
Do like it? Want more? Do it again and get more effect.

Once you have committed your type layer to ‘grunge’ it is no longer a type layer but it is still in a separate layer, so if you come back to the image later and don’t like the effect you can always keep the image, junk the layer, and start again - perhaps with a different typeface.

Here it is a before and after:

And here is an after with it plugged in over an image.

And a final word - you can use the image (in this case the flower) as the displacement map but it pays to play around and choose a displacement map that interacts well with the type. In this case the flower is more or less just in the middle of the ‘page’ so it is only going to interact with the middle of the typeface.

Here is the actual displacement map I used.