An extension of two-color Particle Image Velocimetry (PIV) is described in which the recording media (color film) is replaced with a high-resolution (3060 x 2036 pixel) color CCD sensor. Incorporation of the sensor eliminates the time associated with film development and digitization. Use of color allows the removal of directional ambiguities without resorting to polarization-based image-shifting techniques. For comparing the performance of the color CCD sensor with conventional color film. PI images were obtained on a sand-blasted surface undergoing a known translation and rotation under comparable lighting and camera conditions. Good agreement was obtained between the two recording media, indicating that the behavior of the color CCD sensor is similar to that of 400-ASA color film. This digital two-color PIV (D2CPIV) technique was used for studying simulated turbine film-cooling flows to obtain more detailed characterization of the coolant-injection phenomena and their interaction with freestream disturbances. This technique allowed near-real-time optimization of the PIV parameters which resulted in higher valid vector density and shear-layer resolution.