diff --git a/.changeset/large-snakes-ring.md b/.changeset/large-snakes-ring.md
new file mode 100644
index 0000000000..8e90494d76
--- /dev/null
+++ b/.changeset/large-snakes-ring.md
@@ -0,0 +1,6 @@
+---
+'babel-plugin-emotion': minor
+'@emotion/babel-preset-css-prop': minor
+---
+
+Allow `labelFormat` option to be a function.
diff --git a/packages/babel-plugin-emotion/__tests__/__snapshots__/css-requires-options.js.snap b/packages/babel-plugin-emotion/__tests__/__snapshots__/css-requires-options.js.snap
index b7571b5794..41812a6f07 100644
--- a/packages/babel-plugin-emotion/__tests__/__snapshots__/css-requires-options.js.snap
+++ b/packages/babel-plugin-emotion/__tests__/__snapshots__/css-requires-options.js.snap
@@ -66,6 +66,30 @@ _keyframes(process.env.NODE_ENV === \\"production\\" ? {
 });"
 `;
 
+exports[`babel css inline label format function 1`] = `
+"
+    import { css } from 'emotion'
+    let cls = css({color:'hotpink'})
+    
+
+      ↓ ↓ ↓ ↓ ↓ ↓
+
+function _EMOTION_STRINGIFIED_CSS_ERROR__() { return \\"You have tried to stringify object returned from \`css\` function. It isn't supposed to be used directly (e.g. as value of the \`className\` prop), but rather handed to emotion so it can handle it (e.g. as value of \`css\` prop).\\"; }
+
+import { css } from 'emotion';
+let cls =
+/*#__PURE__*/
+css(process.env.NODE_ENV === \\"production\\" ? {
+  name: \\"1rm02zb-CLS_CSS-REQUIRES-OPTIONS\\",
+  styles: \\"color:hotpink;;label:CLS_CSS-REQUIRES-OPTIONS;\\"
+} : {
+  name: \\"1rm02zb-CLS_CSS-REQUIRES-OPTIONS\\",
+  styles: \\"color:hotpink;;label:CLS_CSS-REQUIRES-OPTIONS;\\",
+  map: \\"/*# sourceMappingURL=data:application/json;charset=utf-8;base64,eyJ2ZXJzaW9uIjozLCJzb3VyY2VzIjpbImNzcy1yZXF1aXJlcy1vcHRpb25zLmpzIl0sIm5hbWVzIjpbXSwibWFwcGluZ3MiOiJBQUVjIiwiZmlsZSI6ImNzcy1yZXF1aXJlcy1vcHRpb25zLmpzIiwic291cmNlc0NvbnRlbnQiOlsiXG4gICAgaW1wb3J0IHsgY3NzIH0gZnJvbSAnZW1vdGlvbidcbiAgICBsZXQgY2xzID0gY3NzKHtjb2xvcjonaG90cGluayd9KVxuICAgICJdfQ== */\\",
+  toString: _EMOTION_STRINGIFIED_CSS_ERROR__
+});"
+`;
+
 exports[`babel css inline label format with dirname, filename, and local 1`] = `
 "
     import { css } from 'emotion'
diff --git a/packages/babel-plugin-emotion/__tests__/css-requires-options.js b/packages/babel-plugin-emotion/__tests__/css-requires-options.js
index f25bf38eb9..c64b0ebc5a 100644
--- a/packages/babel-plugin-emotion/__tests__/css-requires-options.js
+++ b/packages/babel-plugin-emotion/__tests__/css-requires-options.js
@@ -2,6 +2,8 @@
 import babelTester from 'babel-tester'
 import plugin from 'babel-plugin-emotion'
 
+const last = arr => arr[arr.length - 1]
+
 const cases = {
   'label format with only local': {
     code: `
@@ -70,6 +72,26 @@ const cases = {
     babelFileName: __filename
   },
 
+  'label format function': {
+    code: `
+    import { css } from 'emotion'
+    let cls = css({color:'hotpink'})
+    `,
+    plugins: [
+      [
+        plugin,
+        {
+          labelFormat: ({ name, path }) =>
+            `${name.toUpperCase()}_${last(
+              path.replace(/\..+$/, '').split('/')
+            ).toUpperCase()}`,
+          autoLabel: true
+        }
+      ]
+    ],
+    babelFileName: __filename
+  },
+
   // this test has better readability for label alone than other ones which include source maps
   'label on code transpiled by TS': {
     code: `
diff --git a/packages/babel-plugin-emotion/src/utils/label.js b/packages/babel-plugin-emotion/src/utils/label.js
index 3f3aba35be..04833600d7 100644
--- a/packages/babel-plugin-emotion/src/utils/label.js
+++ b/packages/babel-plugin-emotion/src/utils/label.js
@@ -1,6 +1,11 @@
 // @flow
 import nodePath from 'path'
 
+type LabelFormatOptions = {
+  name: string,
+  path: string
+}
+
 const invalidClassNameCharacters = /[!"#$%&'()*+,./:;<=>?@[\]^`|}~{]/g
 
 const sanitizeLabelPart = (labelPart: string) =>
@@ -9,11 +14,23 @@ const sanitizeLabelPart = (labelPart: string) =>
 function getLabel(
   identifierName?: string,
   autoLabel: boolean,
-  labelFormat?: string,
+  labelFormat?: string | (LabelFormatOptions => string),
   filename: string
 ) {
   if (!identifierName || !autoLabel) return null
-  if (!labelFormat) return sanitizeLabelPart(identifierName)
+
+  const sanitizedName = sanitizeLabelPart(identifierName)
+
+  if (!labelFormat) {
+    return sanitizedName
+  }
+
+  if (typeof labelFormat === 'function') {
+    return labelFormat({
+      name: sanitizedName,
+      path: filename
+    })
+  }
 
   const parsedPath = nodePath.parse(filename)
   let localDirname = nodePath.basename(parsedPath.dir)
@@ -24,7 +41,7 @@ function getLabel(
   }
 
   return labelFormat
-    .replace(/\[local\]/gi, sanitizeLabelPart(identifierName))
+    .replace(/\[local\]/gi, sanitizedName)
     .replace(/\[filename\]/gi, sanitizeLabelPart(localFilename))
     .replace(/\[dirname\]/gi, sanitizeLabelPart(localDirname))
 }