ArcMap appears blurry after setting the screen resolution dpi (dots per inch) to other than the normal size (96 dpi), or changing the screen text size to 'Larger (150%)'. When the display settings are changed, the monitor pixels are scaled. This causes the text size to become larger.
This issue is a known limitation. The optimum screen resolution for ArcMap is 1024 x 768 or higher at normal size (96 dpi). Due to limitations imposed by third-party dependencies and some of the component technologies used in ArcMap, as well as the necessity of re-engineering many user interface (UI) components such as icons, dialogs, and controls, ArcMap cannot reasonably be made high-dpi compliant. The following workarounds can be used to address the display issue.
Note: The workarounds listed below improve display clarity, but some UI elements (such as icons and toolbars) may appear smaller.
Esri’s new desktop application, ArcGIS Pro, which is included in the ArcGIS for Desktop licensing, is designed to work with high dpi displays, and scaling values higher than 100%. Consider migrating workflows to ArcGIS Pro to take advantage of the application's native support for high dpi displays.