Several people have noticed that in TFS 2010 the option to branch by label in the UI is no longer present, so I wanted to put up a short post on the subject until we have a chance to fix this (which will hopefully be very near RTM). This change was the result of multiple changes in 2010 around branching:
The result of these changes was that the UI now only presents users the option to create new branches based on Changesets, dates, or the latest version of the parent branch. Until we have a chance to resurface the option to branch by labels in the UI, the command line can be used as a workaround to create branches by label (even when branching first class branches). When we have made the UI changes to add back this option, I’ll post back here.
For more info on branching on the command line, see the Branch Command topic on MSDN.
For more info on changes to branching in TFS 2010, see the post on First Class Branches.
UPDATE: This issue has been fixed as a part of the QFE Rollup and the fix will be available in SP1. You can download the QFE here: http://support.microsoft.com/kb/983504