The Color Burst creates a large group of similar colored Jellys. Tap on one Jelly to change the color of the surrounding Jellys into that Jelly color.
Buy it by tapping on its icon at the bottom of the screen. Activate it any point in the game by tapping on it and choosing a Jelly on the board.
Tip: Use the Color Burst on a Color Combination Level to create a large group of Jellys of the color needed.