diff --git a/changelogs/fragments/colors.yml b/changelogs/fragments/colors.yml
new file mode 100644
index 00000000000..250a9b1982d
--- /dev/null
+++ b/changelogs/fragments/colors.yml
@@ -0,0 +1,2 @@
+bugfixes:
+  - ansible terminal color settings were incorrectly limited to 16 options via 'choices', removing so all 256 can be accessed.
diff --git a/lib/ansible/config/base.yml b/lib/ansible/config/base.yml
index 9f4c17d494a..52d63a8dcd0 100644
--- a/lib/ansible/config/base.yml
+++ b/lib/ansible/config/base.yml
@@ -226,11 +226,7 @@ COLLECTIONS_ON_ANSIBLE_VERSION_MISMATCH:
     warning: issue a warning but continue
     ignore: just continue silently
   default: warning
-_COLOR_DEFAULTS: &color
-  name: placeholder for color settings' defaults
-  choices: ['black', 'bright gray', 'blue', 'white', 'green', 'bright blue', 'cyan', 'bright green', 'red', 'bright cyan', 'purple', 'bright red', 'yellow', 'bright purple', 'dark gray', 'bright yellow', 'magenta', 'bright magenta', 'normal']
 COLOR_CHANGED:
-  <<: *color
   name: Color for 'changed' task status
   default: yellow
   description: Defines the color to use on 'Changed' task status
@@ -238,7 +234,6 @@ COLOR_CHANGED:
   ini:
   - {key: changed, section: colors}
 COLOR_CONSOLE_PROMPT:
-  <<: *color
   name: "Color for ansible-console's prompt task status"
   default: white
   description: Defines the default color to use for ansible-console
@@ -247,7 +242,6 @@ COLOR_CONSOLE_PROMPT:
   - {key: console_prompt, section: colors}
   version_added: "2.7"
 COLOR_DEBUG:
-  <<: *color
   name: Color for debug statements
   default: dark gray
   description: Defines the color to use when emitting debug messages
@@ -255,7 +249,6 @@ COLOR_DEBUG:
   ini:
   - {key: debug, section: colors}
 COLOR_DEPRECATE:
-  <<: *color
   name: Color for deprecation messages
   default: purple
   description: Defines the color to use when emitting deprecation messages
@@ -263,7 +256,6 @@ COLOR_DEPRECATE:
   ini:
   - {key: deprecate, section: colors}
 COLOR_DIFF_ADD:
-  <<: *color
   name: Color for diff added display
   default: green
   description: Defines the color to use when showing added lines in diffs
@@ -272,7 +264,6 @@ COLOR_DIFF_ADD:
   - {key: diff_add, section: colors}
   yaml: {key: display.colors.diff.add}
 COLOR_DIFF_LINES:
-  <<: *color
   name: Color for diff lines display
   default: cyan
   description: Defines the color to use when showing diffs
@@ -280,7 +271,6 @@ COLOR_DIFF_LINES:
   ini:
   - {key: diff_lines, section: colors}
 COLOR_DIFF_REMOVE:
-  <<: *color
   name: Color for diff removed display
   default: red
   description: Defines the color to use when showing removed lines in diffs
@@ -288,7 +278,6 @@ COLOR_DIFF_REMOVE:
   ini:
   - {key: diff_remove, section: colors}
 COLOR_ERROR:
-  <<: *color
   name: Color for error messages
   default: red
   description: Defines the color to use when emitting error messages
@@ -297,7 +286,6 @@ COLOR_ERROR:
   - {key: error, section: colors}
   yaml: {key: colors.error}
 COLOR_HIGHLIGHT:
-  <<: *color
   name: Color for highlighting
   default: white
   description: Defines the color to use for highlighting
@@ -305,7 +293,6 @@ COLOR_HIGHLIGHT:
   ini:
   - {key: highlight, section: colors}
 COLOR_OK:
-  <<: *color
   name: Color for 'ok' task status
   default: green
   description: Defines the color to use when showing 'OK' task status
@@ -313,7 +300,6 @@ COLOR_OK:
   ini:
   - {key: ok, section: colors}
 COLOR_SKIP:
-  <<: *color
   name: Color for 'skip' task status
   default: cyan
   description: Defines the color to use when showing 'Skipped' task status
@@ -321,7 +307,6 @@ COLOR_SKIP:
   ini:
   - {key: skip, section: colors}
 COLOR_UNREACHABLE:
-  <<: *color
   name: Color for 'unreachable' host state
   default: bright red
   description: Defines the color to use on 'Unreachable' status
@@ -329,7 +314,6 @@ COLOR_UNREACHABLE:
   ini:
   - {key: unreachable, section: colors}
 COLOR_VERBOSE:
-  <<: *color
   name: Color for verbose messages
   default: blue
   description: Defines the color to use when emitting verbose messages. i.e those that show with '-v's.
@@ -337,7 +321,6 @@ COLOR_VERBOSE:
   ini:
   - {key: verbose, section: colors}
 COLOR_WARN:
-  <<: *color
   name: Color for warning messages
   default: bright purple
   description: Defines the color to use when emitting warning messages
diff --git a/test/units/config/test3.cfg b/test/units/config/test3.cfg
new file mode 100644
index 00000000000..dab929566a1
--- /dev/null
+++ b/test/units/config/test3.cfg
@@ -0,0 +1,4 @@
+[colors]
+unreachable=bright red
+verbose=rgb013
+debug=gray10
diff --git a/test/units/config/test_manager.py b/test/units/config/test_manager.py
index 3f3347f1cd3..0848276c4b4 100644
--- a/test/units/config/test_manager.py
+++ b/test/units/config/test_manager.py
@@ -18,6 +18,7 @@ from ansible.parsing.yaml.objects import AnsibleVaultEncryptedUnicode
 curdir = os.path.dirname(__file__)
 cfg_file = os.path.join(curdir, 'test.cfg')
 cfg_file2 = os.path.join(curdir, 'test2.cfg')
+cfg_file3 = os.path.join(curdir, 'test3.cfg')
 
 ensure_test_data = [
     ('a,b', 'list', list),
@@ -156,3 +157,16 @@ class TestConfigManager:
 
         actual_value = ensure_type(vault_var, value_type)
         assert actual_value == "vault text"
+
+
+@pytest.mark.parametrize(("key", "expected_value"), (
+    ("COLOR_UNREACHABLE", "bright red"),
+    ("COLOR_VERBOSE", "rgb013"),
+    ("COLOR_DEBUG", "gray10")))
+def test_256color_support(key, expected_value):
+    # GIVEN: a config file containing 256-color values with default definitions
+    manager = ConfigManager(cfg_file3)
+    # WHEN: get config values
+    actual_value = manager.get_config_value(key)
+    # THEN: no error
+    assert actual_value == expected_value