From the Super Mario Wiki, the Mario encyclopedia
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Prism Island is the main setting of the game Paper Mario: Color Splash. The island is first found drained of half its colors. Mario, Princess Peach, and Toad came here to solve a mystery about a colorless Toad, after noticing that the stamp on him is the same on the Prism Island map in the Mario Bros.' House. The culprit turned out to be a corrupted Bowser, who intended to cover the world with black paint. Mario collected all six Big Paint Stars, and upon Bowser's defeat, the island and its colors were restored to normal.
Prism Island is shaped like a giant paint brush, and its "color" districts are arranged in a palette formation. Similarly to how the areas of the Beanbean Kingdom are named after onomatopoeias for laughter and the areas of Pi'illo Island are portmanteaus of items associated with sleep, many areas of Prism Island are named after various colors.
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