One of the camera settings most commonly overlooked by novice photographers is white balance. I believe that's because it's also one of the least understood. If you want colors to render accurately in your photos, or if you want to shift the colors for a particular effect, you need to understand white balance and how it affects your photos.
Definition of White Balance
The term white balance in a way, speaks for itself— it determines how the camera renders a scene to determine how white is displayed. Keep in mind that white light actually contains all the colors of the spectrum, so how white is rendered affects all the other colors in your photo, too.
To understand why it needs to be adjustable, you need to understand that the light reflected from objects in a scene changes according to the light falling on them, and that determines the color that your camera "sees". Chances are, you've been using your camera with the white balance setting in auto mode, so in most cases, you may not have noticed the effect - your camera is adjusting the color values for you. On the other hand, when you look at a shot and the colors seem a little - or a lot - "off", it's probably because your camera was fooled by the lighting situation, which can happen often. Cloudy days, fluorescent lighting, tungsten lighting, snow, low light and many other situations can alter the way colors are rendered. If you've ever taken photos in a gym, for instance, and later found that they had an orange cast, you'll understand why white balance correction is necessary.
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A Word About Color Temperature
Light quality is measured in terms of color temperature and is expressed in degrees Kelvin. This isn't a complete tutorial or a physical science lesson, so I'm not going to go too deeply into that. For the beginner, it's important to know that light can be "warm", "cool", or somewhere in between. Warm light is what causes that wonderful golden quality to photos of objects taken in the light of a sunset. Cooler light tends to bring out blue tones in a scene. Without white balance correction, changes in the color temperature of the light can wreak havoc on your colors.
Automatic White Balance Setting
Your camera came equipped with the capability to digitally adjust the colors in a scene Basically, the camera's processor analyzes the color temperature of the light on the sensor and adds blues or oranges as needed to try and correct what it interprets as incorrect color. It works much like the automatic exposure setting, which tries to correct exposure based on a neutral gray tone. It can also be fooled in the same way as the exposure system, by low light conditions, highly reflective surfaces, lots of a predominant color in a scene, such as a big blue sky, and other situations.
White Balance Presets
Most likely, your camera also came equipped with a number of white balance (WB) presets for different lighting conditions. These "filters" are actually replacements for color filters that were used in the past to correct the light before it entered the lens. How you access these settings will vary by make and model of your camera, but start by looking for a WB button. If you don't see one, consult your manual.
Once you've found your way to the settings, you should see several icons or labels that represent the different presets. You should see options like, "daylight", "shade", "tungsten", "fluorescent", "flash" and others. Each of these should be fairly easy to understand, and they're a quick way to adjust your camera to the current lighting situation. I highly recommend that you take a crack at using these presets. Chances are good that you'll see an improvement in your colors.
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Custom White Balance
Along with those presets, you'll probably find a "custom" setting. This one will allow you to "train" the camera's processor to the current lighting situation, much as you would use a gray card to set exposure. Normally, the procedure will require you to take a photo of a white object in the lighting that you want to adjust to, then tell the camera to use the data gathered in that shot. Once again, the best way to learn to do this is by consulting the manual. This option is a very accurate way to ensure that your colors are rendered correctly and I recommend learning to use it.
Many cameras will also allow you to manually override white balance settings. For the novice, this one might be a little bit too technical and I'd recommend reading up on color temperature before attempting manual white balance correction.
A final note: While white balance adjustment is intended to help you render colors correctly, it's also possible to use the settings to achieve different effects in your photos by deliberately applying settings that don't match the current conditions, i.e. "warming" or "cooling" a scene. Give it a try!