Gray horses are often mistakenly called "white." However, the most noticeable difference between a gray horse whose hair coat is completely white and a white horse is skin color: gray horses have black skin, white horses have pink skin. (Some gray horses may have pink skin under white markings, which, if they had a dark color coat, are visible while the horse still shows its base color). Gray horses are born with a dark base coat, usually bay, chestnut or black that gets lighter as the horse ages. On the other hand, white horses are born white, always have a white coat with no other color present, and stay white throughout their life.

Horses who are a light creme color are technically known as Creme, cremello or perlino horses. Although a white horse may look similar to a very light cremello, the colors come from different genes and produce different colors in their offspring. Cremello and perlino coat colors are produced by a dilution gene sometimes called the cream gene. A cremello always passes on a dilution gene in some form, and so produces a palomino if bred to a chestnut or a buckskin if bred to a bay. On the other hand, a white horse will pass on its white color to some foals but not others, and there is no in-between dilution factor involved.