public class MyDialog extends org.eclipse.jface.dialogs.Dialog
{
    ...

    protected Control createDialogArea(Composite parent)
    {
        Composite container = (Composite) super.createDialogArea(parent);
        container.setLayoutData(new GridData(SWT.FILL, SWT.FILL, true, true));
        container.setLayout(new GridLayout(2, false);

        errorLabel = new Label(container, SWT.RIGHT);
        errorLabel.setLayoutData(new GridData(SWT.FILL, SWT.FILL, true, false, 2, 1));
        ...
    }

    protected void validate()
    {
        ...
        if(!valid)
        {
            errorLable.setText(LongMultiLineErrorString);
            getShell().pack(); // resizes dialog vertically and horizontally
        }
        else
        {
            errorLabel.setText("");
            getShell().pack(); // resizes dialog vertically but not horizontally
        }
    }
}