The most likely explanation is that there are some entries in your date data that are blank or are invalid dates. You cannot apply date grouping to a range that has blank entries or contains any dates that are not valid (the 29th of February in non-leap years being a common example).
If you fix your data so that there are no blank or invalid dates, the error should disappear.
For more about grouping pivot tables by dates, see Expert Skills Lesson 5-20: Group by Date.
Grouping pivot tables by text is a similar feature that allows pivot tables to be grouped by text values. For more information about grouping pivot tables by text, see Expert Skills Lesson 5-19: Group by Text.
If you've fixed your dates and you're still getting the same error, please feel free to reply and I'll do my best to offer further assistance. If you attach a copy of your workbook, I should be able to narrow down exactly which data is causing the issue. For instructions on attaching files, see this thread.
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