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The video tutorial discusses how to display form labels within a form element, specifically on the user login and registration pages. The two modules mentioned are Compact Forms and Infield Labels, with Compact Forms being the more popular choice due to its longevity. Compact Forms is easy to install and does not require third-party plugins or libraries as it uses its own JavaScript. To compact the form, simply add the form ID into the form CSS IDs text area in the configuration settings.