Tone refers to the darkness or shade of color. The darker a diamond, the stronger the tone. Tone and saturation are two completely different elements. A vivid fancy yellow has high saturation and a dark tone. Add a little gray or brown to the yellow and it diminishes the saturation of yellow but maintains or strengthens the tone.
By understanding these three elements of color you know what to expect when a fancy color diamond is being quoted or described. When a GIA report accompanies a stone, these details will give you somewhat of an accurate description before your first peek at the stone.