What you’ve heard throughout your life is true, lighter colours on walls do indeed make those walls seem a little farther away than they actually are while dark colours on the same walls bring them in closer, creating a cozier feel. Thoughtfully using light and dark on walls can also help “regularize” the shapes of rooms that are undesirable, appearing very long or very narrow, for example.
Since few of us live in homes where the rooms are too large, you’ll probably normally want to use lighter colours on walls to make areas seem a little more spacious. If you do have a space that you want to seem particularly snug, go with a darker colour on the walls. Colours on ceilings create the same impressions as those on walls, so use light colours on ceilings unless you live in a rehabbed cathedral.
When something is a darker colour we think it’s heavier than we do when the same exact thing is a lighter one. As a result, if there is a stack of things or some other arrangement where gravity seems like it would come into play or where stability would be desirable, darker objects should be placed closer to the ground and lighter ones higher up—otherwise things will seem “tippy.”