My system for organizing my books is really simple--I store them close to where they will be used, and I sort them by topic or author. We have bookshelves in the kitchen, den, upstairs hallway, in each child's room, and in our schoolroom. First, here is the breakdown of what I keep in each area:
kitchen--cookbooks, telephone books, directories
den--our (Jimmy and me) personal books, Bibles, Bible notebooks, scrapbooks, yearbooks, picture books, board books, fiction for the older children
upstairs hallway--juvenile fiction including most series books (Childhood of Famous Americans, Junie B. Jones, Jigsaw Mysteries, Betsy-Tacy, Nancy Drew and others), my collection of out of print Landmark books, other old books, medical books
each child's room--their personal books, series that interest them in particular (all Little Critter books are in Clay's room, Dr. Suess books in Sam's room, Little House books in Julie's room, plus each girl keeps her vast collection of American Girl doll books in their room), Leah and Sam each have a large collection of picture and board books in their rooms
schoolroom--all science books, history books, craft books, reference books, biographies
In each area the books are sorted by topic or author. When I have a large collection of books by a particular author, I keep them together (John Grisham, Karen Kingsbury). The rest of the books are sorted by category--adult fiction, juvenile fiction, homemaking, parenting, marriage, Bible study, finances, encouragement, medical
In the schoolroom, these are the categories I have
magnets and electricity
science experiement books
nutrition and fitness
history (shelved in chronological order)
If You Lived in the Time of ....
Laurie Carlson type activity books
craft how-to books
art instruction books
In the den and in the boys' room I keep board books in baskets that fit on the shelves. This is a neat way to contain those small, bulky books. Plus you can just bring the whole basket to the couch or bed for reading.
In the schoolroom, some of the categories of books are kept in plastic labeled magazine storage boxes (botany, weather, etc.). I also keep one basket in the schoolroom for books related to our current history or science topic. The children are required to read books from this basket as part of their school. I keep books on a variety of reading levels on each subject studied.
Lastly, I keep a basket in my bedroom for books I am currently reading, and I keep a basket in the den for library books.