Once upon a time, it was believed that dogs could only see the world in black and white. That is, they were thought to be completely color blind. It has since been determined this is not true, but the belief that dogs do not perceive color persists. The truth is, dogs do have color vision, but they do not perceive as many colors as we do and their ability to distinguish color is not the same as ours.
Cones and Colors
Color vision comes from structures called cones, which reside in the retina of the eye and are responsible for the ability to perceive different colors in the light spectrum. Humans are trichromatic, that is, we have three types of cones that allow us to distinguish and differentiate colors, whereas dogs only have two; they are dichromatic, making the range of color they are able to perceive more limited than ours. Dogs have the cones necessary for perceiving the colors blue and yellow, but they lack the red-green cone, which allows humans to differentiate red and green.
Rods and Light
Your dog does, however, have more rods in their retina then you do, making them better at perceiving movement, and improving their ability to see at night. Both of these are sight abilities that were important for the hunter-predator ancestors of your now domesticated dog. But the ability to perceive or distinguish reds and greens is not part of your dog's color perceiving abilities. Though reds and greens probably look greyish or brownish to your dog, he may be able to differentiate the color of red and green objects based on difference in brightness or shade even though the colors themselves are not perceived.
Colors and Choices
Knowing about your dog’s visual abilities may influence your decisions on what color toys to choose for your dog. For example, a yellow ball may show up better to your dog then a red or green ball. It is also important to be aware or your dog’s limited color perception when training or using behavior modification techniques. If you rely on their ability to distinguish colors such as red or green while training your dog, you will be unsuccessful, as your dog can not physically perform this task. Fortunately, this rarely comes up in conventional training and behavioral modification, but it is something to be aware of.
The inability to see and distinguish red and green does not seem to be a liability to dogs. Telling the color of a traffic light does not enter into their daily list of need to knows! Because they can track movement, see blues and yellows, and distinguish items based on their brightness, the inability to perceive reds and greens does not impede their day to day functioning. However, as a pet owner you may recognize that choosing blue and yellow items makes them somewhat easier to differentiate for your dog and this can be useful in training and behavior modification.