Rarity

Rarity is usually considered as a measure of how difficult to obtain or how valuable an item is. The color of the item name text gauges the rarity of an item, with white being the most common and orange being the most rare. All items except white items will not burn when in contact with lava (with the exceptions of Hellstone, Obsidian, Fireblossom, and Fireblossom Seeds).

Tier -0 (Gray)
This Tier is filled with mainly damaged weapons from 1.1, such as the Shameful Iron sword. These are random when reforging via the Goblin Mechanic NPC, or Random when crafting said item.

Tier 0 (White)
All basic items fall under this category. These are mostly building materials. Items that are white are not necessarily worthless, but could be a good source of income early on. Items from this tier will be destroyed in lava, unlike the higher tiers.

Tier 1 (Blue)
Weapons and armor made of early game ores are tier one. Certain accessories such as Shackle and Lucky Horseshoe are also tier one. Certain uncraftable weapons are tier 1 such as the Ball O' Hurt. Most accessories are tier 1.

Tier 2 (Green)
Tier 2 items (green) are largely uncraftable, with the exception of Necro armor, Sandgun, Sunglasses, and the Star Cannon. Muramasa and Harpoon as well as spells like Water Bolt are tier 2 (green).

Tier 3 (Orange)
Weapons and armor made of Hellstone, jungle-related materials or found in chests in underground jungle or underworld are tier 3. Certain uncraftable weapons and accessories are tier 3, such as the Staff of Regrowth, Rocket Boots, Feral Claws, Flower of Fire, and the Dark Lance. These items are rare and usually found later in the game.

Tier 4 (Black)
Some items in the 1.1 update have this rarity, such as the Cobalt Repeater.

Mystery Tier (Purple)
This tier holds Some of the more industrial weapons in 1.1, such as the Flamethrower, Or the Laser Rifle.