To apply the label insdie custom templatessimply create your form in Concrete5 as you normally would using the Form block. then, while still in Edit Mode, click on the form block and choose Design & Custom Template. After that, click on the gear icon and in the Custom Template select box choose the label inside template. When you apply the Label Inside custom template the field labels will be put inside the field for text and text area fields that have been applied to the block. When you click inside the text fields the labels will automatically will disappear.
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(Please note: Label Inside custom template only applies the label inside the form field for the text field, text area, telephone and web address types of form fields. Checkbox, select box and radio buttons will have the label above the form field.)