Colour to fade, we hear (3)
I believe the answer is:
dye
'colour' is the definition.
(I know this)
'fade we hear' is the wordplay.
'fade' becomes 'die' (fade can mean to die away).
'we hear' shows a homophone (sound like).
'die' sounds like 'DYE'.
'to' is the link.
(Other definitions for dye that I've seen before include "Colouring matter" , "Colouring material" , "Colour by dipping in liquid" , "Pigment" , "Colour or stain something" .)