Labeling of gifted pupils can negatively affect the life path of gifted individuals. The study explores whether and how a teacher can label gifted pupils when applying educational strategies based on internal differentiation. We focused on formally identified intellectually gifted pupils (age 7–12) educated in (mainstream) elementary schools in the Czech Republic (Central Europe). Qualitative data were collected through classroom observations and teacher interviews. We observed 24 gifted pupils and 15 teachers from 12 schools. We identified five main types of educational strategies leading to inappropriate labeling, such as Tasks for Quick‐witted, Challenges, Boffins Goes to Competition, Teacher's Assistant, and Individual Projects. The “inappropriateness” of these strategies consisted of the significant preference and presentation of gifted pupils, in the useless and overused selection of gifted pupils, and the rigidity of the applied strategies. The paper seeks to highlight the existence of a paradoxical phenomenon whereby, when teachers are maximally interested in promoting giftedness, the stagnation of gifted pupils and other pupils in the class occurs. The study concludes with recommendations for eliminating inappropriate labeling of gifted pupils.