Color scheme not applied in iTerm2

I've been having the same issue and this is what seems to have solved it:

In your .bash_profile set CLICOLOR before setting TERM:

# Set CLICOLOR if you want Ansi Colors in iTerm2 
export CLICOLOR=1

# Set colors to match iTerm2 Terminal Colors
export TERM=xterm-256color

save bash file and source:

source ~/.bash_profile 

Then, in your iTerm2 Preferences > Profiles > Terminal > Report Terminal Type, set to either xterm-256color or xterm

Close iTerm2, restart it and type ls. That did the trick for me.

Good luck.

Catalina and ZSH

If using ZSH, which is the default shell in Catalina and later, use ~/.zprofile, instead of ~/.bash_profile.

this is a really old question, but make sure your Preferences -> Profiles -> Colors -> Minimum contrast setting is not at the max... if it is and you've done what is suggested above, slide it to a lower setting and you should see the colors appear.

I had the same problem and found a solution: Profiles -> Colors -> Minimum Contrast. If it's high, then you only get black and white.

If you are using zsh and @sam3k answer didn't work for you - you should put those lines in .zshrc instead of .bash_profile

Several answers have mentioned the contrast setting. Even at about 60% of the way across my ANSI blue turned black.

Crank the contrast down before you look for other solutions; it is way more aggressive than I expected.