Adriana at I Heart Tech provides great advice for how to color code your entries in Outlook. Adriana explains the simple steps required to color your world:

First, in case you don’t know, when you create an appointment, you can assign it a color (called a Label in Outlook). It’s very easy to customize the Label list. You can either go to Edit > Label > Edit Labels (not kidding) or you can look for the icon on your toolbar that looks like a little Rubik’s Cube and click on it. Edit and save.

Check out Adriana’s whole post (and the rest of her blog while you are there).