The Grayscale image effect changes colors to grayscale. It can also use a Texture Ramp texture to remap luminance to arbitrary colors.
Like all image effects, Grayscale is available in Unity Pro only. Make sure to have the Pro Standard Assets installed.
Grayscale can do a simple version of color correction, i.e. remap grayscale image into arbitrary colors. This can be used for effects like heat vision.
The process of color remapping is very similar to ColorCorrection effect:
Color remapping works by remapping the original image luminance through the color ramp image (sized 256x1):
A more complex version of color remapping that does arbitrary color correction can be achieved with ColorCorrection image effect.
This effect requires a graphics card that supports Shader Model 2. See the Graphics Hardware Capabilities and Emulation page for further details and a list of compliant hardware.