Many people still believe that dogs are colourblind, only seeing black and white. This is a very popular misconception that even the most devoted dog lovers believe. Dogs are limited in their spectrum of colours if we compare it to human vision, but they do see some colour!
Dogs' eyes contain two kinds of cones, while humans have 3. Cones are photoreceptor cells in the retina of the eye - essentially, they enable pups to distinguish blue from yellow, but not red from green. This is also the most common variation of colour blindness found in humans - and this is simply because they lack the third kind of cone that is in the eyes of humans who can see normally.
The neurons inside a dogs' eye are very active in response to the colour yellow, or shades similar. That activity slows down when blue light hits the cones. Red and green light have a neutral effect on these neurons, so they don't perceive any colour in response to red and green light. In place of these colours, dogs see shades of grey.
Since red objects tend to be darker than green ones, dogs typically use this sense to determine the difference between these two colours.