I organize primarily by size, and then by color. I keep the different sizes in separate bins. Within each size, I also have a section where there are multiple colors. I keep them separate just so I will remember to check them when I am looking for coordinate colors/prints. Next, I do keep "lines" together, mostly by size. Finally, I also have some bins for themed fabrics, like holiday fabric and batiks.

I find managing the leftovers the most challenging, and I don't feel I have discovered the "right for me" method yet - but it is evolving.