— Multiprotocol Label Switching or MPLS technology is being increasingly deployed by several of the largest Internet service providers to solve problems such as traffic engineering and to offer IP services like Virtual Private Networks (VPNs). In MPLS, the analysis of the packet (network layer) header is performed just once, and each packet is assigned a stack of labels, which is examined by subsequent routers when making forwarding decisions. Despite the fact that MPLS is becoming widespread on the Internet, we know essentially very little about the performance one can achieve with it, and about the intrinsic trade-offs in its use of resources. In this paper, we undertake a comprehensive study of the label size versus stack depth trade-off for MPLS routing protocols on lines and trees. We show that in addition to LSP tunneling, label stacks can also be used to dramatically reduce the number of labels required for setting up MPLS LSPs in a network. Based on this observation, we deve...