Labels are more flexible than folders because a given email can have several labels but can’t be in several folders at the same time. A highly requested feature for labels, though, comes from the world of folders: the ability to organize labels hierarchically.
The way these work is exactly like IMAP subfolders have been treated so far, meaning they’re only visually nested. A label named “Work”, for instance, will nest all labels named “Work/[something]“, for instance.
What if the Nested Label option doesn’t show on your labs page? Is there a way to add it?
Nested Labels has graduated from Gmail Labs and is now part of the system without needing to be activated.