In your previous mail program, you might have stored emails you want to keep in folders. In Gmail, you use labels to categorize your emails. Labels are like folders, but with a twist: you can apply multiple labels to a message, then later find the message by looking in any of its labels.
You can also:
Open a label on the left of your Gmail window to see all emails with that label (just like you used to open a folder).
Nest labels within labels, just like you did with folders.
Search for all emails with a label.
See labels on emails in your inbox to quickly identify different types of messages.