In the Albums tab of Photos for iOS, you can create new albums by tapping the (+) button at the top. But if you long-press it, you’ll get the option to create new folders for holding multiple albums.

As far as I can tell, though, there is no way to move existing top-level albums into folders (though you can do this on a Mac). If you want albums in a particular folder, you’ll have to create them there. I hope Apple brings this option to iOS soon.

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