There is no built-in option to do this, but you can doing by using some code.

The easiest way to do this is to first of all install the Stylish extension (https://addons.mozilla.org/firefox/ad.../stylish/). You can then use Stylish to add the code shown here - http://userstyles.org/styles/42402

If you prefer not to use an extension, you can add the code to a file called userChrome.css, for details on that file see http://kb.mozillazine.org/UserChrome.css

Here's what i did, based on the solutions provided in the links in TonyE's post:

Close Firefox and go to your Firefox profile folder. Under it, create a folder named "chrome" (if it doesn't already exist) and under it create a file named "userChrome.css" (again, if it doesn't already exist). Both file and folder should be without the quotes of course. If either of them already exists, don't touch it.

Inside "userChrome.css", paste the following code (not mine, the code is from http://userstyles.org/styles/42402 but it's been slightly modified by me to position the tabs bar more correctly and make it transparent).

@namespace url(http://www.mozilla.org/keymaster/gatekeeper/there.is.only.xul);

#main-window[tabsontop="true"][sizemode="normal"] #TabsToolbar {    
     margin-left: 95px !important; 
     margin-right: 110px !important; 
     background: transparent !important;
}


#main-window[tabsontop="true"][sizemode="normal"] #toolbar-menubar { 
     margin-left: 98px !important; 
     margin-top: -30px !important; 
}


#main-window[tabsontop="true"][sizemode="normal"] #appmenu-button-container {
position: relative !important;
z-index: 2 !important;
}

I definitely would love a built-in option in Firefox to do this !

Editing the "userChrome.css" does not give me satisfaction... :(

I find it annoying that they move. Put them on the title bar, put them below, or give me a choice where to put them, but don't bounce them around...

The solution posted by wander510 doesn't work well for me. It moves not only tabs but also my address bar to the menu bar (when there are no tabs), and it causes things to overlap with the application button in the upper left corner. Looking for another solution.

works great!