Most diamonds appear colorless but actually have slight tones of yellow or brown. The closer the stone comes to colorless, the more valuable it is. Diamonds are graded on a color scale ranging from D (colorless) to Z (heavily tinted.) Only a highly skilled professional will detect any color in E or F stones, and the color in diamonds rated up to J will be virtually invisible when set in a ring or other jewelry.
Diamonds are categorized as either colorless or fancy colored. Fancy colored diamonds are any other color (regardless of saturation) than yellow, brown or gray. They come in a wide variety of colors that include red, blue, green and bright yellow, known as "canary." A fancy colored diamond may also be so saturated in a yellow or brown color, that it would be classified as fancy. A diamond classified as "Fancy" must use that term to describe the color; example, Fancy blue diamond or Fancy yellow diamond. These are graded as Z+. Ones with good color are very rare and can sell for much more per carat than white diamonds.
Most diamonds sold in the retail market have some degree of body color - either yellow, brown or gray. Diamonds with yellow and gray body color are most common.
Color is only one of the four C's so even when a stone has a visible tint, such as K or above, it can still be very lovely if it has good clarity and cut. How the diamond is set can make a difference, too; you might not want to put a truly colorless diamond in a yellow gold setting since the yellow color will reflect in the stone. On the other hand, a slightly yellow stone will appear whiter in a yellow gold setting.
The following is the GIA color scale, which is very commonly used in the United States: