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A large class of problems can be formulated in terms of the assignment of labels to objects. Frequently, processes are needed which reduce ambiguity and noise, and select the best label among several possible choices. Relaxation labeling processes are just such a class of algorithms. They are based on the parallel use of local constraints between labels. This paper develops a theory to characterize the goal of relaxation labeling. The theory is founded on a definition of con-sistency in labelings, extending the notion of constraint satisfaction. In certain restricted circumstances, an explicit functional exists that can be maximized to guide the search for consistent labelings. This functional is used to derive a new relaxation labeling operator. When the restrictions are not satisfied, the theory relies on variational cal-culus. It is shown that the problem of finding consistent labelings is equivalent to solving a variational inequality. A procedure nearly identical to the relaxation operator derived under restricted circum-stances serves in the more general setting. Further, a local convergence result is established for this operator. The standard relaxation labeling formulas are shown to approximate our new operator, which leads us to conjecture that successful applications of the standard methods are explainable by the theory developed here. Observations about con-vergence and generalizations to higher order compatibility relations are described.