Hierarchical Mobility Label Based Network (H-MLBN) is a new approach to the network layer mobility management problem that relies on MPLS-aware control plane and MPLS-based forwarding plane to provide IP mobility support for IPv4 and IPv6 mobile hosts and routers while being able to ensure optimal traffic delivery between the communicating devices. The hierarchical system is capable of both macro- and micro-mobility support without the use of Mobile IP and its derivatives thus eliminating the user and network facing performance penalties associated with triangular routing and bi-directional tunneling. This paper presents a system model and provides performance analysis for H-MLBN and compares its performance with the Mobile IP based schemes. The results indicate significant performance improvements in the forwarding plane traffic delivery as well as the control plane network update costs.