One of the recent changes to the primary game code itself was the implementation of 256 bit colors. In order to take advantage of this, you must have a client that supports 256 colors.
A listing of current MU* Clients that support 256 bit colors be found here.
In order to take advantage of these colors, you must enable the 256Color flag.
In order to view the current color listing (and the various hues offered on TwistedMUCK) please use the command: ansitest
Various options can be set with the new colors via personal configurations via the Player Editor (The command to use this is "pe") and manual toggles. A brief selection of some of the manual toggles are listed below.
This will change the colors of the text that's being said itself.
This will change the color of the pose itself, IE: The name of the person speaking.
This will change the color of the quotes themselves.