There are many different breeds of Chao which can be obtained. When we talk about a Chao's breed, we are referring to its colour pattern, completely separate from and unrelated to its evolution. There are many factors (such as colour and tone) which combine to form the Chao's overall breed. This page will attempt to describe all these factors in detail.
The majority of Chao can be strictly divided into one of two groups: Coloured Chao and Jewel Chao. There are special circumstances in which a Chao can have elements of both; there are very complicated rules for this, and so that information is on the Special Breeds page.
Coloured Chao are the most common as they are the easiest to obtain. In fact, the very first Chao that you start with is a special kind of Coloured Chao, called a Two-Tone Normal.
The most basic element of a coloured breed is, of course, its colour. Every Coloured Chao has a single base colour. They may often appear to visually have multiple colours on their bodies, but this is an effect resulting from other factors of their breed. A Coloured Chao only ever has one base colour, which can be anything in the following list: Normal, White, Red, Blue, Yellow, Pink, Purple, Sky Blue, Orange, Green, Brown, Grey, Lime Green, or Black. You can find images of each colour in the Chao Gallery.
Most of the available colours listed above are self-explanatory: a red Chao will always look red, and a yellow Chao will always look yellow. The normal colour requires more explanation than this. Normal Coloured Chao have a colour which varies depending on their current alignment and evolution. The very first Chao that you start with has the normal colour, and this is why you can see it change colour depending on how you raise it.
It is recommended that you keep at least two of your initial normal-coloured Chao for breeding purposes, and do not have them transform into Chaos Chao. This is because the normal colour is the hardest to obtain and the hardest to breed for. This will be explained further on the Mating page.
Mono-Tone Chao are the easiest type of Coloured Chao to obtain, as they can be purchased as eggs from the Black Market. As you might expect, Mono-Tone Chao appear with a solid colour all over their bodies.
Two-Tone Chao are the other type of Coloured Chao. As previously mentioned, the very Chao that you start with is a Two-Tone Normal Chao. An immediate difference that you may notice between your starter Chao and the Mono-Tone Chao that you buy from the Black Market, is that the starter Chao has multiple colours on its body. For example, a neutral baby Chao will have yellow highlights on its head, hands, and feet, and a darker blue patch on its body. These highlights are what makes the Two-Tone Chao special.
Two-Tone Chao are harder to obtain than Mono-Tone Chao because they cannot be bought. Instead, you need to breed for them. An easy way to do this is to buy the matching Mono-Tone Chao from the Black Market, and then breed it with one of your starter Chao. If you're lucky, you'll get a Two-Tone version of that colour. For more information, see the the Mating page.
Shiny Chao are, unsurprisingly, Chao which are shiny. This is not a type distinct from the Mono-Tone or Two-Tone types. Instead, Chao of both types can be either shiny or non-shiny.
Jewel Chao are a rarer breed of a Chao which have a special jewel-like pattern to them; imagine a shiny, sparkling crystal. It is also commonly thought of as a metallic sheen. Unlike coloured Chao, Jewel Chao do not have the shiny, two-tone, mono-tone factors. All Jewel Chao appear with a solid, metallic texture.
Every Jewel Chao has a single jewel coat, which defines its colour. This is similar to the base colour of a Coloured Chao, but it is important to make the distinction between a base colour and jewel coat. They are two separate things, and this can become very important when it comes to breeding and obtaining special breeds.
Every Jewel Chao has one of the following jewel coats: Silver, Gold, Ruby, Sapphire, Amethyst, Emerald, Garnet, Aquamarine, Peridot, Topaz, or Onyx. You can find images of each jewel coat in the Chao Gallery.