A new personalization capability is coming on SharePoint Online and OneDrive for Business: folder colorization.
Yes, you have read correctly, you are being able to set colors (from a set of 16 different colors) on folders (new and existing) on SharePoint Online and OneDrive for Business.
Deployment of this feature is currently underway, with a completion expected by October 2023.
Important note, the colorization will only be visible when accessing SharePoint Online or OneDrive for Business with a web browser – if you are syncing folders on your device, the colorization will not be available.
If you want to set a color on a folder on SharePoint Online or OneDrive, access the corresponding site and location to open the contextual menu of a folder and open the Folder color option
You can then choose the color to apply to this folder
When renaming an existing folder, you will also get the option to set the color, which will be the same experience when creating a new folder