Champagne dilutes red pigment to a golden color, and black to a chocolate color. Horses with champagne and one cream gene look a lot like a double-dilute.
The Champagne gene is newly discovered, but has probably existed for hundreds of years. These horses used to be confused with other colors, and many amber champagnes were called 'lilac dun', although they may or may not have had a dun gene along with the champagne gene. Some champagnes may also have been called pink-skinned palominos or wheaten-skinned palominos in older texts.
Champagnes are interesting in several ways. First, a foal is born darker than the color it will mature to be-- this is the opposite of most foals. The eyes of a champagne at birth are a bright blue color, and the skin is a freckled pink color (called 'pumpkin skin'). The skin will remain pink and freckled throughout the horse's life, but the eyes will change to a bright green, then to an greenish-yellow amber color.
Many champagnes have a brilliant metallic sheen. This sheen is caused by the way light reflects off the hairs. A Champagne's hair is structured differently than most other horses; they have a hollow hair shaft. A similar effect is seen in the Akhal-Teke, which almost all of that breed are a brilliant metallic color. Akhal-tekes, however, are not champagnes. The metallic sheen alone is not enough to distinguish a champagne horse, as not every champagne will have this sheen, and many non-champagnes may be metallic.
Champagne on a black is called Classic champagne. The color is hard to describe; the black is diluted to sort of a beige color, or a liver chocolate. They are sometimes mistaken from grullas (black dun) but they lack the dun primitive marks.
Champagne on a bay is called Amber champagne. The body is beige, and the points are a light chocolate color.
Champagne on a chestnut is called Gold champagne. The body is diluted to a golden color, and the mane and tail are usually golden, too. The body can range from light to dark golden. These horses are sometimes mistaken for palominos, and in the past were called pink-skinned palomino.
Ivory champagne is a term used to describe a champagne with a cream dilution gene-- a palomino or buckskin with champagne. These horses are very light and may be mistaken for double dilutes. Since the term Ivory champagne can be somewhat misleading as there are many different dilution combinations, it is best to call the horses by 'proper' terms, such as 'palomino champagne' for a horse with a Cr and Ch gene, or "amber dun" for an amber champagne with a dun gene.
Champagne occurs in the Tennessee Walking Horse, Quarter Horse, Saddlebred, Missouri Fox Trotter, and it may be yet undiscovered in other breeds.