What chat formatting plugin are you using?
For EssentialsChat it would be;
&e{factions_name} &3{DISPLAYNAME}&0: &4{MESSAGE}
Which would look something like this;
Eclipse Derp: Here is my message.
The &x is the colour code, while {factions_name} is where the player's faction will go.

Rapidz, you have to use a plugin that formats chat such as EssentialsChat, just add [{FACTION}] in with your chat layout in the config.yml and you're good to go! eg;

Go to plugins folder, then go to Essentials, open 'config.yml', (With Notepad++ recommended), keep scrolling down until you reach 'Chat' settings, and you will see this:

format: '{DISPLAYNAME} {MESSAGE}'

Just add [{FACTION}].
So it will look like this:
format: '[{FACTION}]{DISPLAYNAME} {MESSAGE}'

That's it, replace with original config, and reload / restart the server.
It will work .

Here's the whole main code:
############################################################
# +------------------------------------------------------+ #
# | EssentialsChat | #
# +------------------------------------------------------+ #
############################################################
chat:
# If EssentialsChat is installed, this will define how far a player's voice travels, in blocks. Set to 0 to make all chat global.
# Note that users with the "essentials.chat.spy" permission will hear everything, regardless of this setting.
# Users with essentials.chat.shout can override this by prefixing text with an exclamation mark (!)
# Users with essentials.chat.question can override this by prefixing text with a question mark (?)
# You can add command costs for shout/question by adding chat-shout and chat-question to the command costs section."
radius: 0
# Chat formatting can be done in two ways, you can either define a standard format for all chat
# Or you can give a group specific chat format, to give some extra variation.
# If set to the default chat format which "should" be compatible with ichat.
# For more information of chat formatting, check out the wiki: http://wiki.ess3.net/wiki/Chat_Formatting
format: '[{FACTION}]{DISPLAYNAME} {MESSAGE}'
#format: '&7[{GROUP}]&r {DISPLAYNAME}&7:&r {MESSAGE}'
group-formats:
# Default: '{WORLDNAME} {DISPLAYNAME}&7:&r {MESSAGE}'
# Admins: '{WORLDNAME} &c[{GROUP}]&r {DISPLAYNAME}&7:&c {MESSAGE}'

Note: Remove the "#" before "format" so that enables in the chat.
Otherwise it won't work.

So like:
#format: '[{FACTION}]{DISPLAYNAME} {MESSAGE}'

To:
format: '[{FACTION}]{DISPLAYNAME} {MESSAGE}'

Bump?