Color is graded on a scale of D to Z, D being colorless, Z being the darkest shade of light yellow attributed to the scale. The closer to D on the scale, the more valuable the diamond.
Clarity is rated between Flawless (FL) / Internally Flawless (IF) all the way to three levels of Imperfect I1, I2, and I3. Flawless it the most prized.
Pink diamonds are becoming popular in the current market, where yellow diamonds or clear diamonds were once prized.
See the Related Link for more extended information about the rating system and value placed on diamonds.