Have you ever printed a photo and noticed that it looked different on paper than it did on your computer? That's because different devices (digital cameras, computer monitors, scanners, printers) can portray different ranges of colors. If you're not managing those colors, the translation from computer monitor to printer can produce surprising, and often disappointing, results.
Color management systems map colors from one device to another, so that what you see on your computer monitor more closely approximates what you'll get when you print. Of course, if you're posting your files to the web, this isn't such a big issue. But if you plan to print the photos you're editing, take a few minutes to set up color management so that your edits will help you get the best printed results.
To manage color for your images, choose Edit > Color Settings. Then, choose either Always Optimize Colors For Computer Screens, Always Optimize For Printing, or Allow Me To Choose. Click OK.
Photoshop Elements uses color profiles (called ICC profiles) to manage color. The option you choose determines which profile the application uses to interpret and display colors. You don't have to know much about color management to use it in Photoshop Elements. Just select the option that makes sense for the way you use photos. If almost all of your images are bound for the web, optimize for the screen. If almost all are destined to be printed, optimize for printing. And if you do some of each, opt to choose.