1) Before a series or list that comes after a complete sentence...
The United States has four military branches: the Army, the Navy, the Marine Corps, and the Air Force.
... but not if the colon comes immediately after a preposition or a verb closely connected with the list.
Wrong: The colors of the American flag are: red, white, and blue. Right: The colors of the American flag are red, white, and blue.
2) Between two complete sentences or independent clauses.
Ben tried to remember: Where had he last seen his keys?
Suddenly, it came to her: Emily had seen the driver before.
3) In formal business address:
Dear Sir/Madam: Dear Mr. Jones:
To all Department Heads: Dear Customer:
Note that if the words following a colon form a complete sentence, the first word should be capitalized. If they don't form a complete sentence, the first word is lower-cased.
