The color editor is a dialog that lets you pick colors for the various places in the interface where you need to set them, such as in the Materials Asset bar.
The basic idea is that anywhere you click will set the color to what you see. The large bars let you adjust the current color along the Hue, Saturation, Vibrance, Red, Green, or Blue spectrum. The smaller bars at the top let you choose a fully vibrant color along the hue spectrum, or a grayscale value.
You can click undo to go back to the color that was selected when the dialog was opened. Also, you can click the eyedropper button to sample a color from somewhere on your desktop.