What is a diamond's colour, and how does it affect the price?

Diamonds usually look white, but are they really white? Actually diamonds can be totally colourless, but some could have a slight yellow colour.

A diamond's colour can be graded as follows:

Colourless: D, E, F

Near colourless: G, H, I, J

Faint (very slight yellow): K, L, M

Very light (light yellow): N, O, P, Q, R

Light (yellow): S - Z

Colourless diamonds (D, E, F) are more valuable. On the other hand, diamonds with more yellow colour are cheaper. But when buying engagement rings or diamond jewellery, usually colourless or near colourless diamonds are more beautiful.

Sources: GIA (Gemological Institute of America)