Gmail team has just rolled out some great 3 new features in gmail including new superstars, nested labels and advanced imap controls. One of most useful feature among all three is nested labels as nested labels give you the ability to organize labels hierarchically. Starting today, nested labels are enabled for everyone along with a couple of small improvements such as a sticky collapse/expand state and better editing options.
As you can see in the image below, in order to create a nested label you just need to right click over a existing label and then select Add sublabel under an existing label.
To start using them, you can either create a new sub-label from the dropdown menu on the left hand side or just move an existing label under another one using the edit option:
This way you can make more out of gmail labels and on the same time make them hidden as nested labels so that they don’t show up in left pane navigation menu, you can also read our guide on hiding labels shown in left pane gmail navigation menu.