1. Go to Template > Edit HTML and check the check box which says Expand the Widget Templates.
2. Now in the Template, Find
<b:include data='top' name='status-message'/>
and immediately above that, paste this line of code
<b:include data='posts' name='breadcrumb'/>
3. Now find
<b:includable id='main' var='top'>
If you find two occurrences of this, then locate the second one(locate the only one otherwise) and immediately above that paste this code snippet
<b:includable id='breadcrumb' var='posts'> <b:if cond='data:blog.homepageUrl != data:blog.url'> <b:if cond='data:blog.pageType == "static_page"'> <div class='breadcrumbs'><span><a expr:href='data:blog.homepageUrl' rel='tag'>Home</a></span> » <span><data:blog.pageName/></span></div> <b:else/> <b:if cond='data:blog.pageType == "item"'> <!-- breadcrumb for the post page --> <b:loop values='data:posts' var='post'> <b:if cond='data:post.labels'> <div class='breadcrumbs' xmlns:v="http://rdf.data-vocabulary.org/#"> <span typeof="v:Breadcrumb"><a expr:href='data:blog.homepageUrl' rel="v:url" property="v:title">Home</a></span> <b:loop values='data:post.labels' var='label'> <b:if cond='data:label.isLast == "true"'> » <span typeof="v:Breadcrumb"><a expr:href='data:label.url' rel="v:url" property="v:title"><data:label.name/></a></span> </b:if> </b:loop> » <span><data:post.title/></span> </div> <b:else/> <div class='breadcrumbs'><span><a expr:href='data:blog.homepageUrl' rel='tag'>Home</a></span> » <span>Unlabelled</span> » <span><data:post.title/></span></div> </b:if> </b:loop> <b:else/> <b:if cond='data:blog.pageType == "archive"'> <!-- breadcrumb for the label archive page and search pages.. --> <div class='breadcrumbs'> <span><a expr:href='data:blog.homepageUrl'>Home</a></span> » <span>Archives for <data:blog.pageName/></span> </div> <b:else/> <b:if cond='data:blog.pageType == "index"'> <div class='breadcrumbs'> <b:if cond='data:blog.pageName == ""'> <span><a expr:href='data:blog.homepageUrl'>Home</a></span> » <span>All posts</span> <b:else/> <span><a expr:href='data:blog.homepageUrl'>Home</a></span> » <span>Posts filed under <data:blog.pageName/></span> </b:if> </div> </b:if> </b:if> </b:if> </b:if> </b:if> </b:includable>
This code will only display the last label of the post in the breadcrumb. If you want to display all the labels, then you will have to remove those 2 red lines of code.
4. Save the Template
5. If you want to make the breadcrumb smaller then go to Template Designer >Advanced > Add CSS and add the following Snippet there and Apply the changes
.breadcrumbs { padding:5px 5px 5px 0px; margin: 0px 0px 15px 0px; font-size:95%; line-height: 1.4em; border-bottom:1px solid #e6e4e3; }