A method and system, including a computer program product, implementing a color terminology for accurate color grading of gemstones are provided. The method includes generating a reference color to match that of a graded gemstone under the standard viewing environment, processing color data in different color spaces, assigning a color grade to specify the color of the gemstone graded. The reference color can be continuously changed by adjusting the hue, lightness and saturation values. The color grade comprises a color name and one or more corresponding color coordinates and/or one or more corresponding color notations, in the form of Color Name (Color Coordinates). The color name is used for verbal description of the color, and the color coordinate or color notation is for accurate color communication in the jewelry industry.