It's actually alot easier:

Code:
Private m_lOrigColor As Long
Private Sub Form_Load()
    m_lOrigColor = Label1.BackColor
End Sub


Private Sub Form_MouseMove(Button As Integer, Shift As Integer, X As Single, Y As Single)
    Label1.BackColor = m_lOrigColor
End Sub


Private Sub Label1_MouseMove(Button As Integer, Shift As Integer, X As Single, Y As Single)
    Label1.BackColor = vbRed
End Sub
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Serge

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