I have around 100 shoebox-sized bins, stacked nested without lids as Sean says below, with the larger pieces and basic bricks/plates/slopes. I also have a bunch of smaller bins (maybe 40?) that are half that size, stacked the same way. And then I have some of the flat tackle-ish boxes. 95% of my sorted pieces are stored in one of these three types of containers, all of which fit fairly well in Ikea wall shelves. The big bins fit into a section width-wise, 2 stacks of bins per shelf. The smaller bins fit in depth-wise, with (7?) stacks per shelf. I only have one shelf that has just these- the rest are scattered about (like the Technic small bins sharing a shelf with the Technic tackle boxes).

If you really care for way more detail:

Basic pieces are sorted by color and type:
1xN bricks (black only is also sorted into large and small 1xN bricks)
2xN bricks (black only is also sorted into large and small 2xN bricks)
1xN and 2xN plates
4xN plates
6xN and larger plates
1:1 slopes
1:2 slopes
Other slopes

There are variations within this, like some colors have all of the slopes mixed together or black only has the 1xN bricks divided into longer and shorter ones.

Everything else (except for rare colors and trans pieces) is sorted by part type, not by color at all.

They are broken out like:
Radar dishes
2x2 round pieces
3x3 and 4x4 round pieces
Arches and round bricks
Panels
Wall sections
Car specialty pieces (chassis, fenders, etc.)
Train specialty pieces
Doors & Windows
Tiles
Decorated pieces
Technic bricks
Brackets and bricks with side studs (not including 1x1s)
Things with strings
…more

The smaller bins are sorted similarly, but contain pieces of which I have fewer:
Large curvy/slopey bits (ie 1x6 slopes, 3x8x2 and 3x12 curved wedges, 6x8x2 windscreens)
Small curvy/slopey bits (ie 2x2 funky “racers” slopes, new 1x1 slopes)
Turntables
Ladders
Fences
Things with strings
1x1 round pieces
Textured pieces (corrugated, log, and grooved)
Things with strings
…many more

Really small stuff fits into the tackle boxes. I have 4 for minifigs, 2 for minifig accessories, 2 for small Technic bits, 3 for various hinges, and 3 more for:
Trans 1x1s bricks and plates, and headlight bricks
Clips and Bars
Small wheels

Those are all of the easily-accessible parts. I also have a few rarely-accessed things sorted into Lego bins or large cardboard boxes, like baseplates, boat bases, really giant panels, flora and fauna, electric and otherwise motorized pieces, etc.

The main disadvantage I see in this is that specific small basic bricks, plates, and slopes pieces can be hard to find. My 1x1 bricks should be sorted out separately (just haven’t done it), as should 1x1 plates and 1x2 of the same. I also need to break out the decorated pieces bin into some tackle boxes. Another thing that is a bit awkward is when I buy in bulk and have a preposterous number of a particularly weird piece. Tossing 400 each of black and white 2x2 tiles in with the rest of the tiles doesn’t make sense, so I sometimes bag things and then toss the bag in the bin where the parts would go. I also have a “bulk” tub that contains baggies of pieces that I have in large quantities. That in particular would be confusing to someone looking through the collection, but works for me because I know for the most part what’s in there.

How certain pieces are sorted is often a convoluted series of exceptions. In some cases, someone who has a good understanding of the general system without knowing the specific exceptions might look in 3 places before finding the part, or might miss a really weird bin. Two of the stranger ones are labeled “Where do these go?” and “Opaque canopies”.

One of these days, I’ll probably put this info on my web site along with pictures to help explain it… not my top priority.
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Tony Hafner
www.hafhead.com