This plugin allows users to assign categories to items in their Media Library with a clean and simplified, filterable version of the standard category meta box. The filter allows you to narrow your search for category as you type – this filter is not native to WordPress but is instead borrowed from Jason Corradino’s Searchable Categories plugin. If you would like to enable this feature for your posts and pages download his plugin here.
I’d like to point out that I drew some inspiration from the ‘WOS Media Categories’ plugin which is not generally easy to find since its not in the plugin directory. However WOS Media Categories was missing the clean simple to use hierarchical category interface that we are used to in WordPress. A couple of my projects were dependant that plugin, but as the scale of the project increased and the number of categories grew exponentially, the disorganized grid of checkboxes were no longer a viable option.
Checkout these related plugins from which I borrowed code and drew inspiration.