change according to comments

Author: topper-123

pandas/core/dtypes/dtypes.py

@@ -272,7 +272,7 @@ def _from_values_or_dtype(cls, values=None, categories=None, ordered=None,
         ordered : bool, optional
             Designating if the categories are ordered.
         dtype : CategoricalDtype or the string "category", optional
-            If ``CategoricalDtype`` cannot be used together with
+            If ``CategoricalDtype``, cannot be used together with
             `categories` or `ordered`.
 
         Returns
@@ -294,7 +294,7 @@ def _from_values_or_dtype(cls, values=None, categories=None, ordered=None,
         ValueError: Cannot specify `categories` or `ordered` together with
         `dtype`.
 
-        The supplied dtype takes precedence over values's dtype:
+        The supplied dtype takes precedence over values' dtype:
 
         >>> CategoricalDtype._from_values_or_dtype(c, dtype=dtype2)
         CategoricalDtype(['x', 'y'], ordered=False)
@@ -493,7 +493,7 @@ def validate_categories(categories, fastpath=False):
         """
         from pandas import Index
 
-        if not fastpath and not is_list_like(categories, allow_sets=True):
+        if not fastpath and not is_list_like(categories):
             msg = "Parameter 'categories' must be list-like, was {!r}"
             raise TypeError(msg.format(categories))
         elif not isinstance(categories, ABCIndexClass):

pandas/tests/dtypes/test_dtypes.py

@@ -106,7 +106,7 @@ def test_constructor_invalid(self):
                                  [c, None, None, dtype2, dtype2],
                                  [c, ['x', 'y'], False, None, dtype2],
                              ])
-    def test_create_categorical_dtype(
+    def test_from_values_or_dtype(
             self, values, categories, ordered, dtype, expected):
         result = CategoricalDtype._from_values_or_dtype(values, categories,
                                                         ordered, dtype)
@@ -117,11 +117,9 @@ def test_create_categorical_dtype(
         [None, ['a', 'b'], None, dtype2],
         [None, None, True, dtype2],
     ])
-    def test_create_categorical_dtype_raises(self, values, categories,
-                                             ordered,
-                                             dtype):
+    def test_from_values_or_dtype_raises(self, values, categories,
+                                         ordered, dtype):
         msg = "Cannot specify `categories` or `ordered` together with `dtype`."
-
         with pytest.raises(ValueError, match=msg):
             CategoricalDtype._from_values_or_dtype(values, categories,
                                                    ordered, dtype)