The main goal of this paper is to present the significance of the term labour, and to point out its role as a factor of production in chosen schools of economics. The studies conducted in the paper have purely theoretical scope and had been undertaken based on the analysis of Polish and foreign literature. In Polish writings, one can notice some inaccuracy in understanding labour, its divisions and place among factors of production. In the first part of this paper the reader can find historical overview of economic analysis of labour and its significance as a factor of production. Second part concerns problems and impreciseness in studies over labour and its place in economics.