I store my fabric in drawers like what Toogie showed. The only difference is that I cut comic book boards to fit the drawers and wrap my fabrics around the. I use one of the 3 drawer chests to store quilting fabric yardage - one drawer for darks, one for mediums and one for lights. Within those categories they are loosley grouped by color. I use another 3 drawer chest to store pieces of quilting fabric that are bigger than a fat quarter but smaller than a yard, also separated the same way as my yardage. Fat quarters are stored in their own unit. Smaller scraps have their own sets of shallow drawers and are sorted by color and size.
I also have drawer units for the home dec fabrics that I inherited from my grandmother.
Different storage methods work for different people, it just depends on your situation and how you use your fabrics.
Rob