The Color is measured in terms of how white or colorless a diamond is, from D - being the most colorless - to Z – which contains noticeable brown or yellow, the most common side shade, obtained as a result of nitrogen in the stone -.
Color is a natural element in a diamond, but it is essentially a visual distraction that affects sparkle. So this grades how much that color shade can be seen, and makes sure that the diamond is clear of any tinting that takes away or interferes with white and colored light reflections. It is also an important factor that affects the price of the diamond.
The exception is made for certain colored jewels that are valued stones, like a fancy pink or green diamond. Color grades for those are distinctly different than traditional “white” ones.