Add this to the template you want the list to appear.
Output:
Category Name 1
post title 1
post title 2
post title 3
Category Name 2
Post title 1
Code Snippet:
<?php
//for each category, show all posts
$cat_args=array(
'orderby' => 'name',
'order' => 'ASC'
);
$categories=get_categories($cat_args);
foreach($categories as $category) {
$args=array(
'showposts' => -1,
'category__in' => array($category->term_id),
'caller_get_posts'=>1
);
$posts=get_posts($args);
if ($posts) {
echo '<p>Category: <a href="' . get_category_link( $category->term_id ) . '" title="' . sprintf( __( "View all posts in %s" ), $category->name ) . '" ' . '>' . $category->name.'</a> </p> ';
foreach($posts as $post) {
setup_postdata($post); ?>
<p><a href="<?php the_permalink() ?>" rel="bookmark" title="Permanent Link to <?php the_title_attribute(); ?>"><?php the_title(); ?></a></p>
<?php
} // foreach($posts
} // if ($posts
} // foreach($categories
?>
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