I needed labels for a small prototype run of a new product recently; lacking time to have these professionally made I bought some Avery-brand mailing labels and printed them myself on our color laser printer, finding that with careful design and a decent printer this type of label can produce surprisingly good results.
These 5195-type labels are 0.66 by 1.75 inch; 60 pieces come on an American letter-size sheet of backing paper. Avery provides templates for their label products in Microsoft Word format, which of course isn't good enough. I built a template in Adobe Illustrator instead and laid my design out on that grid. Because there's a small chance someone else in the world will find this useful, I'm writing this blog post and providing the AI template for download here.
You may have to adjust the position a bit to suit your own printer; the file I'm providing to the public is neutral but in my personal version of it I had to tweak things a bit to compensate for a persistent leftward bias displayed by my printer. You'll probably also find that position varies by as much as a sixteenth of an inch from print to print, so design accordingly with a safe zone and a bleed zone if desired. Designing with a black or color background and printing a bleed off the edge is a good trick for disguising the lowly origin of these labels, by the way; white on black doesn't look like a typical mailing address label nearly as much as black on white does.
If you're doing one-off or prototype hardware and need to label your product with something, experiment with this technique—it's better than the output from a label-maker at any rate. Have fun and remember to share your results!
Update, 2/28/2014: Here's another template, for Avery 5160 labels.