Yes, dogs can see in color; but, their perception of various colors is not exactly the same like it is for humans.
Scientists have long known that dogs’ eyes are physically equipped to perceive colors, and that canines are not colorblind. Dogs can see in color, but colors that they see are not rich as what people usually see.
“Cones” are special light catching cells in the eyes that respond to color. Because dogs have fewer cones as compared to humans, it suggests that their perception of color is not as vivid or as penetrating as ours.
The key to color vision is not only dependent on having these special lighting cells; Having many different kinds of cones, each set to different light wavelengths, is also vital to seeing color. Because humans have three different types of cones, the dynamics of these cells give us rich, full-range and intense color vision.
Dogs, which have only two types of these cones, can see a very dark grey, darker yellow, kind of brown, light yellow, grey, light blue, and dark blue color. In other words, dogs only see the colors of the world as essentially grey, blue, and yellow.