What do the different colors of the tab title in iTerm2 mean?

The iTerm color change of Tab labels indicates activity.

It can be turned of in: Preferences > Appearance > Color tab labels on activity

The help file explains this "Color tab labels on activity" appearance preference as follows:

If selected, tab labels become purple when a non-selected tab has new output, and red when a non-selected tab has output you haven't seen but that is not very recent.