A colony was an area settled by individuals from a different area on a planet, or from another planet.
Colonies on Earth
The British Empire claimed Australia and used it as a prison colony where they shipped convicts. The idea was recommended to the British government by Joseph Banks after he was confronted by Ian Chesterton who accidentally gave Banks the idea. (AUDIO: The Transit of Venus)
India was a British colony from the 18th century until it gained independence in 1947. (PROSE: All-Consuming Fire, PROSE: Ghosts of India)
Colonies beyond Earth
When humans began to explore space, they started colonies in the Solar system first. Several were on Mars, (TV: The Waters of Mars, PROSE: GodEngine, TV: The Daleks' Master Plan), Jupiter, (AUDIO: The Jupiter Conjunction, the Saturnian moons Mnemosyne, Titan and Japetus, (PROSE: The Wheel of Ice, Legacy) and Charon, a moon of Pluto. (PROSE: GodEngine)
Eventually, humans established colonies light-years from Earth like They're All Nouns You Idiot, which got its name from bad-tempered and mistranslated natives. It was more commonly known as Noun. (PROSE: Ghost Devices)
Further in the future, they expanded beyond Mutter's Spiral. Humans settled on Metralubit in the Fostrix Galaxy in the fifty-eighth segment of time. (PROSE: The Well-Mannered War) The Tenth Doctor and Rose Tyler visited New Earth, located in the M87 galaxy, in the year 5,000,000,023. (TV: New Earth) He returned with Martha Jones in 5,000,000,053. (TV: Gridlock)
Non-human colonies
Dronid and Karn were colonies of Gallifrey. (PROSE: Shada, Alien Bodies, Cat's Cradle: Time's Crucible)