Colour grading actually has 2 components. The first one is to correct colours and make them match to create a consistent scene and the second one is to alter colours for aesthetic purposes to create a certain mood. This second process is much more about intuition than colour science and therefore the most notable skill of a good colourist is his ability to recognize when colours look right rather than just being able to operate the colour grading equipment. The basic aim of colour grading is to create consistency within a scene, so that all the shots have the same colour balance and therefore no one shot looks out of place and distracts the viewer. This is also known as "continuity grading". You might wonder why this is necessary, but due to the scheduling it often happens that shots belonging to the same scene are filmed at different times when the lighting and weather conditions have changed. When these shots are cut together this becomes apparent and colour grading needs to iron out these differences. Furthermore, some shots will require some "repairing" either due to a wrong colour balance or under or over-exposure. Luckily, most formats have some degree of latitude, which means they record information even where the image appears to be peak white or very dark. This information can usually be "pulled back" and used to correct exposure mistakes. Colour casts, on the other hand, can be corrected by balancing a region that should be neutral. For instance, if a white wall appears blue then the image can be balanced by adjusting the colour controls so the wall appears white again. It is important to know that human vision is "calibrated" for flesh colours and even the slightest colour casts can be spotted easily on these colours. Therefore, the most important requirement for correcting colour casts is to make sure the flesh tones of people in the scene look right.
The most creative challenge for colour grading is to create a look for a film. This can be achieved in a variety of ways. Colour casts can be deliberately introduced to suggest a certain mood. For instance a yellow-green cast can be used in a horror film to evoke feelings of unease. On the other hand, an orange cast can create feelings of warmth and happiness. With modern colour grading equipment this can be taken a step further and the scene can be totally relit by selectively darkening or lightening certain elements of a scene. A good example of how far colour grading can be pushed is the film "300" by Zack Snyder, where most of the scenes where shot against green screen to later insert highly stylized backgrounds and skies.