Nothing seems to have as much impact on atmosphere as wall color. When walking into a room, a bright, bold color on the wall can instantly startle, stumble, or wake up an individual who was previously lost in a daydream. The formerly frazzled might step into a calming nest of blue walls and feel the heartbeat slow and sense the nerves begin to calm. Psychological attachments or color memories can imperceptibly alter mood, but emotional responses to color vary by person.
Research has indicated that warm hues, such as reds and yellows, are perceived as stimulating and are often associated with aggression, strength, courage, frustration, lust, and feelings related to action and assertion. Many of the studies tagging red with this stimulating effect were done in North America, so it's easy to see how the use of red as the color used for fire engines, ambulances, and emergency signs in this region could be attached to a cognitive trigger for a "stimulating" effect. Other areas may use color in different ways, however, so associations are not the same for every person or culture.
Blue and green used as calming colors is probably a more universal notion. The blue skies and waters and the green color of things growing in nature is often associated with feelings of peace, so blue or green wall color is often used as a nod to focusing on feelings of calmness. Sensory reactions to these colors can even result in a slower pulse and lowered body temperature, which indicates strong psychological ties to different colors. There is a big difference between a sedated dark green and a neon green, however, and the tone and shade of colors also play a big role in determining the color's effect, in addition to personal experience and memory.
Anytime a shade of color is taken to its brightest hue possible, the effect will be stimulating, simply because the visual jolt of anything bright causes the eye to physically react. Neon shades will not likely make for a restful bedroom, but they would be an invigorating color for an athletic facility. Other common color associations are the purity, simplicity, and innocence of white; the formality and elegance of black; and the royalty and nobility of purple. So memory, history, culture, and personal preference and associations all play a role in the effect of wall color on mood.