Each player sacrifices all colored permanents they control.
6/15/2010 A colored permanent is a permanent with at least one colored mana symbol in its mana cost. Note that effects may cause a colored permanent to become colorless (as Moonlace could), or a colorless permanent to become colored (as Crimson Wisps could).
6/15/2010 Tokens may also be colored permanents. The effect that creates a token states what color it is or whether it’s colorless.
6/15/2010 Lands have no mana cost, so they are colorless unless an effect states otherwise.
6/15/2010 All the colored permanents are sacrificed at the same time.
7/1/2013 All Is Dust doesn’t destroy permanents. Rather, it causes them to be sacrificed. Regeneration, totem armor, and indestructibile can’t save permanents from All Is Dust.