In order for the dye to be used, this must first be reduced to a (usually colourless) soluble form, in which the material to be dyed is soaked. The colour develops when the dyed material is exposed to oxygen in the atmosphere; and as it is insoluble, should not wash out when the material is cleaned. The name of "vat dye" derives from the large vats in which the reduction process was originally performed.

Common examples of vat dyes are indigo and Tyrian Purple.