Google's data-crunching ways found that the majority of Gmail users aren't actually using the webmail service's labels. Starting today, those label names get higher placement, and drag-and-drop labelling aims to make Gmail's labels more like familiar email folders.
By placing users' own labels higher up on the left-hand sidebar, right below the main Inbox/Starred/Sent/Drafts destinations, Gmail admits that keeping them in their own box, stuck underneath the chat widget, implied they weren't that important before. Fixes like those contained in Gina's Better Gmail 2 Firefox extension and the "Go to label" keyboard shorcut in Gmail's Labs section helped, but now labels are easier to reach, and kept more at the front of your email-clearing mind.
Those higher-up labels are also a boon to frequent mouse users, as you can now click and drag an email message onto a label to "move" it into that label (kind of like a folder, no?), or drag the label onto the message to, uh, label it.
Google will officially announce these changes later today, and the functionality will be "rolling out gradually" to Gmail users.