When your existing labels become obsolete (or perhaps you were a little carried away with label making) you may want to delete some of your labels.
It's easy to delete a label. You can do it in the Labels section of the Settings Menu.
Once you're in Labels, you'll see a complete list of all of the labels you have created. Just click on the trash can at the side of the label you'd like to remove to delete it.
Please note: Once you delete a label, it will disappear from your labels list and all emails still tagged with the label. Make sure you really want to delete the label before throwing it in the trash!