I am using inherited agile template where in Epic level backlog, we have hierarchy Epic > Feature > User Story
I am defining a custom work item type "Requirement" which I want to add under Feature and also display in the backlog hierarchy.
I could not figure out how to do it.
1st, I would create a new Inherited Process (Organization Settings | Process) to ensure that you don't impact anyone else using the existing process model.
2nd, you don't mention if you linked the new "Requirement" to the "Feature" as a child. If you don't have that association, it won't appear in the hierarchy.