Solution: Add the following code to the side-bar where you want the labels:
<div id="labelList"></div>
<script type="text/javascript">
//<![CDATA[
function listLabels(root){
var baseURL = '/search/label/';
var baseHeading = "Labels";
var isFTP = false;
var llDiv =
document.getElementById('labelList');
var entry = root.entry;
var h2 = document.createElement('h2');
h2.className = 'sidebar-title';
var h2t =
document.createTextNode(baseHeading);
h2.appendChild(h2t);
llDiv.appendChild(h2);
var ul = document.createElement('ul');
ul.id = 'label-list';
var category = entry.category;
labelSort = new Array();
for(p in category){
labelSort[labelSort.length] = [category[p].term];
}
labelSort.sort();
for (var r=0; r <
labelSort.length; r++){
var li = document.createElement('li');
var a = document.createElement('a');
if(isFTP){
a.href = baseURL + encodeURIComponent(labelSort[r])+'.html';
}
else {
a.href = baseURL + encodeURIComponent(labelSort[r]);
}
a.innerHTML = labelSort[r] + ' ';
li.appendChild(a);
ul.appendChild(li);
abnk = document.createTextNode(' ');
ul.appendChild(abnk);
}
llDiv.appendChild(ul);
}
//]]>
</script><script type="text/javascript" src="http://www.blogger.com/feeds/USERID/blogs/BLOGID?alt=json-inscript&callback=listLabels"
></script>
For a very detailed solution (and the actual source) see: http://phydeaux3.blogspot.com/2007/05/automatic-list-of-labels-for-classic.html