diff --git a/CHANGELOG.md b/CHANGELOG.md
index 0abda0a..d298d1b 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -5,12 +5,43 @@ All notable changes to this project will be documented in this file.
 ## [Unreleased] - 2026-01-04
 
 ### Added
-- **Label Management System**: Complete redesign of label/tag management
+- **Label Management System**: Complete redesign of label/tag management with color filtering
   - Added `Label` model to Prisma schema with centralized database storage
+    - Fields: id, name, color, userId, createdAt, updatedAt
+    - Color field supports 10 pastel colors (default, red, orange, yellow, green, teal, blue, purple, pink, gray)
   - Created `LabelContext` for global state management with React Context API
+    - Provides labels array and loading state
+    - Exposes functions: addLabel, updateLabel, deleteLabel, getLabelColor, refreshLabels
   - Added `useLabels` hook for easy access to label functionality
   - Implemented full CRUD API for labels (GET, POST, PUT, DELETE)
+    - `/api/labels` - GET all labels, POST create new label
+    - `/api/labels/[id]` - GET specific label, PUT update, DELETE remove
   - Updated all components to use the new context instead of localStorage
+  - **New Components**:
+    - `LabelBadge` - Reusable component for displaying label badges
+      - 3 variants: default, filter, clickable
+      - Automatic color display via context
+      - Optional remove button (X icon)
+    - `LabelSelector` - Dropdown for selecting labels in note input
+      - Shows count of selected labels
+      - Uses LabelBadge for each option
+    - `LabelFilter` - Filter interface with color and label selection
+      - Color filter: 10 color buttons with label count per color
+      - Label filter: Checkbox list of all labels
+      - Clear all button to reset filters
+  - **Color Filtering**:
+    - Filter notes by label color via URL parameter `?color=blue`
+    - Shows number of labels per color
+    - Highlights selected color with ring effect
+    - Automatically filters label list when color is selected
+  - **Updated Components**:
+    - `note-input.tsx` - Added LabelSelector for label selection during note creation
+    - `note-card.tsx` - Uses LabelBadge to display labels on notes
+    - `note-editor.tsx` - Uses LabelBadge to display labels in editor
+    - `header.tsx` - Added selectedColor and onColorFilterChange props
+    - `header-wrapper.tsx` - Manages color filtering via URL params
+    - `page.tsx` - Filters notes by selected label color
+    - `layout.tsx` - Wraps app with LabelProvider
 
 ### Fixed
 - **Tests**: Fixed Playwright drag-and-drop tests to work with dynamically generated note IDs