Hi Nancy,
You should be able to rename, however, you should be aware that custom fields have a preceding ‘c_' to their name so that part will remain. So, if you rename from "MyField” to "MyNewField” then the actual field's name will be renamed from: "c_MyField” to "c_MyNewField”.
You can find/learn the true names of your custom field if you navigate to the WSAPI at: https://rally1.rallydev.com/slm/doc/webservice/ then select your artifact from the Object Model list on the left pane, then scroll down the list of fields to locate your custom field where you will see the true name with the preceding ‘c_'.
Further more, you need to make certain that if you custom field is/was used by external applications or clients then you need to update all these programs after the rename. This is not automatically done.
Please let me know if that answered your question.
Thanks,
Sagi