you dont need to create a function.BTW,you provided incorrect info.
Table1.Field1 Values (" Road", " Lane", " Street", " Highway")
Table2.Field2 Values (" Rd.", " Ln.", " St.", " Hwy.")
should be
Table2.Field1 Values (" Road", " Lane", " Street", " Highway")
Table2.Field2 Values (" Rd.", " Ln.", " St.", " Hwy.")
Here is the query
update table1 set field1 =
substring(field1,1,charindex(' ',field1)-1)+
(case when right(field1,len(field1)-charindex(' ',field1))= 'Highway' then ' Hwy.'
when right(field1,len(field1)-charindex(' ',field1))= 'Street' then ' St.'
when right(field1,len(field1)-charindex(' ',field1))= 'Lane' then ' Ln.'
when right(field1,len(field1)-charindex(' ',field1))= 'Road' then ' Rd.' end) from table1