How To: Create polygon between irregular edges of existing polygons in ArcMap
You can use the Editor's Auto Complete Polygon task twice to create and merge two adjacent polygons across the area between irregular edges of existing polygons.
Click Editor > Snapping. For the layer being edited, set snapping to Edge, Vertex, or both.
Open the Task dropdown list and click Auto Complete Polygon.
Create a polygon beginning and ending at the desired locations along one of the irregular edges. Extend the polygon about half way to the other irregular edge and square off the leading side with two vertices.
Click Editor > Snapping. Make sure Vertex is checked for this layer.
Create a polygon off the opposite complex edge. Snap to the two corner vertices of the polygon created in step three and complete the polygon at the desired location on the second irregular edge.
For non-coverage data, select both new polygons and use Editor > Merge.
For coverage polygons, use the shared edit tool
Shared edit tool icon is on the Editor toolbar
to select their common border arc. Then delete it.