Note: This article applies to ArcGIS versions 10.0. Later versions of ArcGIS may contain different functionality, as well as different names and locations for menus, commands and geoprocessing tools. For more current information on layer packages, see the article ArcMap: Package Layer.
When adding a basemap layer using the Add Basemap dialog from the Add Data menu, the basemap layer is not succesfully added to the map document.
Note: This can also happen when adding content from Add Data > Add Data from ArcGIS Online.
This is a known issue introduced with the File Menu Performance patch for Version 10.0, Service Pack 3 and occurs at Service Packs 4 and 5. The problem occurs when the length of the Windows username exceeds 10-13 characters.
Note: Content from ArcGIS Online also has respective folders and an associated layer file inside each folder that can be added to the map.