The "latex" interpreter only works if an external LaTeX tool chain
is present. Three binaries are needed: latex, dvipng, and
dvisvgm. If those binaries are installed but not on the path, one can
still provide their respective path using the following environment variables:
OCTAVE_LATEX_BINARY, OCTAVE_DVIPNG_BINARY, and
OCTAVE_DVISVG_BINARY.
Note that Octave does not parse or validate the text strings when in
"latex" mode—it is the responsibility of the programmer to generate
valid strings which may include wrapping sections that should appear in Math
mode with '$' characters.
See, for example, https://www.latex-project.org/help/documentation/ for
documentation about LaTeX typesetting.
For debugging purpose, a convenience environment variable,
OCTAVE_LATEX_DEBUG_FLAG, can be set to trigger more verbose output
when Octave fails to have a given text compiled by an external LaTeX engine.
For example, "x^2" is not a valid LaTeX string and the following
example should fail
setenv ("OCTAVE_LATEX_DEBUG_FLAG", "1")
x = 1:10;
plot (x, x.^2)
title ("x^2", "interpreter", "latex")
Searching the terminal output you should find some helpful info about the origin of the failure:
...
No file default.aux.
! Missing $ inserted.
<inserted text>
$
l.6 x^
2
! Missing $ inserted.
...
If no usable LaTeX tool chain is found at the first text rendering, using
the "latex" interpreter is equivalent to "none".