Colouring up means exchanging a pile of low-value chips for fewer chips of a higher denomination. Land-based casinos give each denomination its own colour, so the swap literally changes the colour of the player’s stack.
Players usually ask to colour up when they leave a table, because a few large chips are easier to carry to the cage than a tower of small ones. Dealers like it too: big stacks of low-value chips slow the game, take up space on the layout and make bets harder to read at a glance. In tournament poker the term also covers the chip race, when the smallest chips are removed from play and exchanged for larger ones as the blinds rise.
The online equivalent
Digital tables have no physical chips, but the chip selector does the same job. Offering sensible chip values for each table’s limits keeps betting quick for both low-stakes and high-stakes players, and avoids dozens of clicks to build a single bet.