Diamond colour is grades according to how colourless it is.  In other words the hightest colour grade starting at D colour is a diamond that has no tint and is amazingly clear.  As the grading goes down the diamond has increasing amount of tint and colour, usually tending towards the brownish grey colours and then eventually yellow. 

Colour is a very comparative and subjective characteristic.  As such it is 3rd after Cut and Clarity in terms of importance for diamond characteristics.  Diamonds in the D-F range are considered colourless.   Diamonds in the G-I colour range are considered near colourless.  Purchasing diamonds within these two colour ranges will show as a very nice diamond if given the cut is high and the clarity is above SI1. 

The scale for diamond colour is illustrated in the diagram below.

             

Diamonds have more colours other than clear to yellow.  They have a range of colours from blue, red, fancy yellow and pink.  Naturally coloured diamonds are worth a considerable amount more than their clear counterparts.  With that said, fancy coloured diamonds also have a range in the intensity of colour which can affect the pricing.  The higher richness and saturation in colour the higher the pricing. 

Treated, or artificially, coloured diamonds do exist and should always be disclosed to the buyer when purchasing fancy coloured diamonds.  Common processes to treat diamonds for colour are Irradiation and High Pressure High Tempurature (HPHT).  Treated diamonds are worth significantly less than naturally coloured diamonds.

In summary,  diamond colour should be judged with the naked eye with considerations for diamonds in the D-H range.  Everyone views colour differently and this should be kept in mind when buying diamonds.  If buying a fancy coloured diamonds make sure wether its treated or natural and should be disclosed up front when buying. 

Cut

Clarity

Colour

Carat