Google has overhauled the way users can interact with their labels. The changes include a new location on the Gmail homepage for labels and as well as the ability to drag and drop emails directly into labels.Big changes for those of you who use labels within Gmail.

Labels have been moved. On the left side of the inbox, labels have been placed above the chat list, lumped in with the listings of inbox, drafts, chats and other labels. Placing them closer to the actual folders makes it easier to sort through your most important messages without having to scroll down the page.

Users can now also hide/show their labels. Google says that it implemented this feature to help people hide labels they don't use often and always have quick access to the ones they use most. If you want to see the hidden labels, click the "more" button.

Label settings can be edited in bulk in Gmail's settings pages.

Last, emails can now be dragged and dropped into labels just as if they were folders.

On a sad note, with all these new label features, Google has killed off the "Right Side Labels" setting in Gmail labs.