I have been making embroidered labels lately. I like the triangle shape so I only have to hand sew one edge as the other 2 edges get sewn when I attach the binding. I try to use the same fabric as the backing if not too dark, otherwise I'll use one of the fabrics from the top and then use similar thread colors to make up the saying for the label. My hand writing sucks so that's my reason I use the embroidery machine.

If you have an embroidery machine you can purchase label designs for them and add the writing. If not use one of the many ways already suggested.
good luck.

I use a piece of muslin, whatever size I need to write all I want to write on the label--quite a bit of history about each quilt--and put a two and one half inch border of some of the fabric in the quilt top around it. I use a permanent marker--Pigma is probably the most durable--and in my own hand I write the information. I think having the label written by the maker gives the quilt a kind of life that you can't get with machine embroidery or printed labels. Having my mother's recipes written in ink by her is important to me and I think having quilt labels written by me will be important to the owners of the quilts after I am dust or ashes. forggyintexas

I had discovered this method a few weeks ago from a Bonnie Hunter blog. I have 6 inch squares ironed in half near my sewing machine. I use the pigma pens. Now it is not a chore to make the label.

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I make my labels in Microsoft Word, then use either Bubble Jet Set or an Iron-on Inkjet sheet to print the label. If I know who the quilt is going to, I'll usually try to include a picture of them on the label. I also put a QR code on the label that goes directly to our blog in case it gets lost (so the finder can be kind and return it!) and washing instructions. The label shown was for my niece's wedding - he was transferred to England with the army.

As I am sure you have decided, everyone does it differently. I consider my labels as part of my quilt. I used to hand embroider each one but I had to give that up and now machine embroider just names and dates.
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i embroider mine with my embroidery machine onto a piece to temtex with fabric over it, then I have a satin stitch all around this and hand appliqué it onto the backing of the quilt. I try to use different shapes for every quilt.

I take a large piece of fabric of choice can be muslin or matching solid. I use my sewing machine Janome6500 with alphabet to stitch my label. I put who it is to, who it is from (gramma Sue Balchak) date, city/state and a message, trim it down to 1/2 in to 1 inch around the stitching, then I use a fusible web on the back, press to the quilt backing B4 it is quilted, stitch around the edges and then continue with sandwiching and quilting the quilt.

I encourage you to use full names and even a short story or sentiment on your label. You never know when your quilt will show up in the future, maybe 50-100 years from now, maybe even get into a museum (don't laugh) and the more info on the back the more it will have historical interest and value.

I struggled/struggle with labels also. I tried the freezer paper and muslin and would probably have done that, but then used machine embroidery. I have also embroidered on the binding itself (before stitching it). I like the idea of sewing it on before quilting (easier, can machine sew), but I wasn't sure how it would look quilted over.