Morbus Iff organizes his LEGO bricks into tackle/bead divider boxes for the smallest pieces (which paradoxically then take up the most amount of room but are far more accessible), and zip bags for larger pieces, then shoves those elements into larger drawer bins. The following is my forever in-progress organization. Images from http://www.peeron.com/. This is not meant to list every piece I have (Brickset + Peeron FTW), but rather to indicate where like items go.
Drawer 2
Divider Box
Row 1
Technic Axle Joiner Inline Smooth
Technic Axle
Joiner Offset
Technic Connector 2 x 3 with Ball Socket and Smooth Sides
Technic Bush with Three Axles
Technic Pole Reverser Handle
Row 2
Technic Axle
Joiner Perpendicular
Technic Beam 2 Liftarm with Hole and Axlehole
Technic Beam 2 with Handle
Technic Beam
3 x 0.5 Liftarm
Technic Beam 4 x 0.5 Liftarm with Boss
Row 3
Technic Connector Toggle Joint Toothed
Technic Pin
1/2 with Bar 2L
Technic Pin Long
with Friction
Technic Pin Long
with Stop Bush
Technic Pin with
Friction and Slots
Row 4
Technic Gear
14 Tooth Bevel
Technic Gear 24 Tooth Crown Type III (x ptrn)
Technic Gear 24 Tooth with Three Axleholes
Technic Engine Crankshaft
Technic Engine Connecting Rod
Technic Engine Crankshaft Centre
Technic Engine
Cylinder Head
Technic Shock Absorber 6.5L
Technic Steering
Wheel Small
Bag "T05": Plates
Technic Plates 1 x n with Holes
Technic Plates 2 x n with Holes
Bags "T06" and "T07": Bricks
T06: Technic Bricks
(<= 1 x 4) with Holes
T07: Technic Bricks
(>= 1 x 6) with Holes
Bags "W01" and "W02": Wheels and Vehicle Parts
W01: Large individual wheels of various shapes and models
W02: Plate 2 x 2 with Wheels Holder (+ tires).
W02: Plate 2 x 2 with Wheel Holder (+ tires).