From the man dialog Version: 1.1-20100428 from Fedora 14.
man dialog section on color
--colors
Interpret embedded "\Z" sequences in the dialog text by the fol-
lowing character, which tells dialog to set colors or video
attributes: 0 through 7 are the ANSI used in curses: black, red,
green, yellow, blue, magenta, cyan and white respectively. Bold
is set by 'b', reset by 'B'. Reverse is set by 'r', reset by
'R'. Underline is set by 'u', reset by 'U'. The settings are
cumulative, e.g., "\Zb\Z1" makes the following text bold (per-
haps bright) red. Restore normal settings with "\Zn".
Without the --colors don't know how \Z would be handled, or what
happens with what appears after the \Z