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TouchWiz (TouchWiz Nature UX on Samsung Galaxy S III mini) allows creating folders and reorganizing application in application list / app drawer (in "Apps") when using 'Customisable grid' view type:

"Menu > View type > Customisable grid", then "Menu > Create folder"

screenshot of TouchWiz application list with two folders

This allows creating folders to group applications. You can edit name of folder by touching it and then touching on name, you can put such folder on home screen / launcher via long press, and you can put applications in folder via "Menu > Edit" and selecting folder (edit works only on folders); then in this edit mode you can add apps with "+", and remove them by moving them outside folder.

screenshot of TouchWiz application list with editing folder

I cannot find however how to remove such folder from TouchWiz app drawer.

(The articles and answers I have found by googling are about folders on home screens, i.e. in apps launcher not apps drawer).

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Once you have created a folder in the Apps (i.e. I created a "Temp") and then remove it:

1. Go to the App Drawer, Apps, and find the panel holding the folder.
2. Menu > Edit
3. Press and hold the folder until "Remove" appears.
4. Drag to Trash Can (Remove).
5. Save

Gone.

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For Samsung Galaxy S7 or S7 Edge, follow the steps below: Go to App Drawer -> Click Edit -> Click Minus ("-") sign on the folder you wish to remove -> Click Delete on the warning displayed and you are done.

The apps will not be uninstalled, only the folder will be removed. The apps would show normally in the App Drawer afterwards.

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