How do I add a library project to Android Studio?

Question

How do I add a library project (such as Sherlock ABS) to Android Studio?

(Not to the old ADT Eclipse-based bundle, but to the new Android Studio.)

Answer 1

The easiest way I found to include external library project is (for example to include a Facebook library which is stored one directory up in the dependencies folder):

1. In settings.gradle add

   include ':facebook'
   
   project(':facebook').projectDir = new File(settingsDir, '../dependencies/FacebookSDK')
   

2. In build.gradle dependencies section, add

   compile project ('facebook')
   

All left to do is synchronise the project with gradle files.