Since the adoption of digital video cameras and cross-correlation methods for particle image velocimetry (PIV), the use of color images has largely been abandoned. Recently, however, with the re-emergence of color-based stereo and volumetric techniques, and the extensive use of color microscopy, color imaging for PIV has again become relevant. In this work, we explore the potential advantages of color PIV processing by developing and proposing new methods for handling multi-color images. The first method uses cross-correlation of every color channel independently to build a color vector cross-correlation plane. The vector cross-correlation can then be searched for one or more peaks corresponding to either the average displacement of several flow components using a color ensemble operation, or for the individual motion of colored particles, each with a different behavior. In the latter case, linear unmixing is used on the correlation plane to separate each known particle type as captured by the different color channels. The second method introduces the use of quaternions to encode the color data, and the cross-correlation is carried out simultaneously on all colors. The resulting correlation plane can be searched either for a single peak, corresponding to the mean flow or for multiple peaks, with velocity phase separation to determine which velocity corresponds to which particle type. Each of these methods was tested using synthetic images simulating the color recording of noisy particle fields both with and without the use of a Bayer filter and demosaicing operation. It was determined that for single-phase flow, both color methods decreased random errors by approximately a factor of two due to the noise signal being uncorrelated between color channels, while maintaining similar bias errors as compared to traditional monochrome PIV processing. In multi-component flows, the color vector correlation technique was able to successfully resolve displacements of two distinct yet coupled flow components with errors similar to traditional grayscale PIV processing of a single phase. It should be noted that traditional PIV processing is bound to fail entirely under such processing conditions. In contrast, the quaternion methods frequently failed to properly identify the correct velocity and phase and showed significant cross talk in the measurements between particle types. Finally, the color vector method was applied to experimental color images of a microchannel designed for contactless dielectrophoresis particle separation, and good results were obtained for both instantaneous and ensemble PIV processing. However, in both the synthetic color images that were generated using a Bayer filter and the experimental data, a significant peak-locking effect with a period of two pixels was observed. This effect is attributed to the inherent architecture of the Bayer filter. In order to mitigate this detrimental artifact, it is suggested that improved image interpolation or demosaicing algorithms tuned for use in PIV be developed and applied on the color images before processing, or that cameras that do not use a Bayer filter and therefore do not require a demosaicing algorithm be used for color PIV.