Chromatophores are specialized cells that synthesize pigments in animals. They play an important role not only in coloration, but also have crucial functions in a series of biological processes such as warning, mating, camouflage, mimicry, concealment and environmental adaptation. Compared with amniotes that only depended on melanocytes to produce color pattern, teleost and other ectothermic vertebrates derived more than six types of chromatophores from embryonic neural crest, including melanophores, xanthophores, erythrophores, iridophores, leucophores and cyanophores. During embryonic development, neural crest cells differentiate into the precursors of chromatophores along the dorsal ventral axis and then migrate to specific sites to mature pigment cells, which can selectively absorb or reflect specific wavelength of light to form multiple pigment patterns and colors. So, the number and distribution area of pigment cells, the dispersion and contraction of pigment particles all affect body color formation. Xanthophores are the most concerned chromatophores, second only to melanophores. Xanthophores have red/yellow xanthosomes composed of carotenoids and pteridines, which produces a series of colors from white to red and is an ideal model for pigment cells interaction, pigmentation and animal evolution. Though many mechanisms of xanthophores differentiation and pigmentation are starting to be elucidated, few reports summarize the available progression in xanthophore biology and genetics. Thus, this review introduces the advances in research of origin and distribution of fish chromatophores, the development and differentiation of xanthophores, the regulatory mechanism of pteridine pigments synthesis and the inadequacies in current xanthophores researches. It provide useful information in fish coloration, chromatophores differentiation and molecular breeding of body color phenotype.