the quick and dirty method consists in using the "union" tool with the layer alone. Two new polygons will be created where polygons are overlapping and you can remove one of them. This is not straightforward but you can use "find identical" to get the polygons to be deleted.
The more advanced solution consists in building a topology for your layer (with the mustn't overlap" rule), then you can using the topology fixing tools.
Subtract: The Subtract fix removes the overlapping portion of geometry
from each feature that is causing the error and leaves a gap or void
in its place. This fix can be applied to one or more selected Must Not
Overlap errors.
Merge: The Merge fix adds the portion of overlap from
one feature and subtracts it from the others that are violating the
rule. You need to pick the feature that receives the portion of
overlap using the Merge dialog box. This fix can be applied to one
Must Not Overlap error only.
Create Feature: The Create Feature fix
creates a new polygon feature out of the error shape and removes the
portion of overlap from each of the features, causing the error to
create a planar representation of the feature geometry. This fix can
be applied to one or more selected Must Not Overlap errors.