These examples show how AutoCAD LT applies a "best fit" for arrowheads and text.
Even if the arrowheads are outside the extension lines, you can have a line drawn between the extension lines. This is called forcing an internal line and is illustrated above.
You can draw several different styles of diameter dimensions depending on the dimension text horizontal settings and whether you select Force Line Inside.
The rightmost illustration shows a combination of fit and orientation settings. The Text and Arrows and the Inside Horizontal options are both selected. The resulting text is inside the extension lines and forced to remain horizontal instead of aligning with the dimension line. (For a description of orientation settings, see Controlling the Orientation of Dimension Text.)
In the leftmost diameter dimension, AutoCAD LT places the text outside the circle and draws a leader line from the text to the circumference of the circle when DIMUPT is on and DIMFIT is 0. Because Center Mark is selected, a center mark is drawn inside the circle. In this case, the text is placed horizontally with no forced interior lines for the dimension line.