The third Colorado (BB-45) was launched on 22 March 1921 by the New York Shipbuilding Co., Camden, New Jersey, sponsored by Mrs. M. Melville, and commissioned on 30 August 1923 with Captain R.R. Belknap in command.

Colorado embarked on her maiden voyage from New York on 29 December 1923, visiting Portsmouth, England; Cherbourg and Villefranche, France; Naples, Italy; and Gibraltar before returning to New York on 14 February 1924. After repairs and final tests, she sailed for the West Coast on 11 July, arriving in San Francisco on 16 September 1924.

From 1924 to 1941, Colorado operated with the Battle Fleet in the Pacific, participating in fleet exercises and ceremonies, and occasionally returning to the East Coast for fleet problems in the Caribbean. She also cruised to Samoa, Australia, and New Zealand from 8 June to 26 September 1925 to show the flag in the Far Pacific. She assisted in earthquake relief at Long Beach, California, on 10 and 11 March 1933, and during an NROTC cruise from 11 June to 22 July 1937, she aided in the search for the missing Amelia Earhart.

Based in Pearl Harbor from 27 January 1941, Colorado operated in the Hawaiian training area, engaging in intensive exercises and war games until 25 June, when she departed for the West Coast and an overhaul at Puget Sound Navy Yard, completed on 31 March 1942.

After training on the West Coast, Colorado returned to Pearl Harbor on 14 August 1942 to finalize preparations for action. She operated near the Fiji Islands and New Hebrides from 8 November 1942 to 17 September 1943 to prevent further Japanese expansion. She departed Pearl Harbor on 21 October to provide pre-invasion bombardment and fire support for the invasion of Tarawa, returning to port on 7 December 1943. After a West Coast overhaul, Colorado returned to Lahaina Roads, Hawaiian Islands, on 21 January 1944 and departed the next day for the Marshall Islands operation, providing pre-invasion bombardment and fire support for the invasions of Kwajalein and Eniwetok until 23 February, when she headed back to Puget Sound Navy Yard for another overhaul.

Joining units bound for the Mariana Islands operation in San Francisco, Colorado sailed on 5 May 1944 via Pearl Harbor and Kwajalein for pre-invasion bombardment and fire support duties at Saipan, Guam, and Tinian from 14 June. On 24 July, during the shelling of Tinian, Colorado received 22 shell hits from shore batteries but continued supporting the invading troops until 3 August. After repairs on the West Coast, Colorado arrived in Leyte Gulf on 20 November 1944 to support American troops fighting ashore. A week later, she was hit by two kamikazes, killing 19 of her men, wounding 72, and causing moderate damage. Despite this, she bombarded Mindoro between 12 and 17 December before proceeding to Manus Island for emergency repairs. Returning to Luzon on 1 January 1945, she participated in pre-invasion bombardments in Lingayen Gulf. On 3 January, accidental gunfire hit her superstructure, killing 18 and wounding 51.

After replenishing at Ulithi, Colorado joined the pre-invasion bombardment group at Kerama Retto on 25 March 1945 for the invasion of Okinawa. She remained there, providing fire support until 22 May, when she departed for Leyte Gulf.

Returning to occupied Okinawa on 6 August 1945, Colorado sailed from there for the occupation of Japan, covering the airborne landings at Atsugi Airfield, Tokyo, on 27 August. Departing Tokyo Bay on 20 September 1945, she arrived in San Francisco on 16 October, then steamed to Seattle for the Navy Day celebration on 27 October. Assigned to "Magic Carpet" duty, she made three trips to Pearl Harbor to transport 6,357 veterans home before reporting to Bremerton Navy Yard for inactivation. She was decommissioned and placed in reserve on 7 January 1947, and sold for scrapping on 28 July 1959.

Colorado received seven battle stars for her World War II service.