Brake fluid is usually a clear or slightly amber-colored hydraulic fluid, as is obvious by this picture. Being
hydroscopic (moisture absorbing) in nature, brake fluid must be sealed from the outside atmosphere. This is
why the master cylinder has a rubber seal on the filler cap, and the brake hydraulic system is sealed.
Color
Healthy brake fluid is a translucent clear color, not rusty or black. If it is rusty,
then the system has moisture in it and rust has formed. Sometimes a simple
brake fluid flush can avert further damage. However, the system should be
closely inspected to make sure that rust has not damaged any parts before doing
a brake fluid flush. If the brake fluid is black, the system has overheated. Brakes
can overheat if they are abused when in use, or if a brake caliper sticks and does
not release. The excessive heat causes the brake fluid to boil and burn, turning it
black and causing it to lose its hydraulic properties. If this is the case, determine
the cause of overheating and repair as needed. Then do a fluid flush and refill
with fresh fluid.