A penalty card is used in many sports as a means of warning, reprimanding or penalising a player, coach or team official. Penalty cards are most commonly used by referees or umpires to indicate that a player has committed an offense. The referee will hold the card above his or her head while looking or pointing towards the player that has committed the offense. The colour and/or shape of the card used by the official indicates the type or seriousness of the offence and the level of punishment that is to be applied.

By analogy the term is sometimes used in other areas than sport. For example, the UK Radio Authority speaks of issuing a yellow card to those who break its rules.

The idea of using language-neutral coloured cards to communicate a referee's intentions originated with British football referee Ken Aston. Aston had been appointed to the FIFA Referees' Committee and was responsible for all referees at the 1966 FIFA World Cup. In the quarter finals, England met Argentina at Wembley Stadium. After the match, newspaper reports stated that referee Rudolf Kreitlein had cautioned both Bobby and Jack Charlton, as well as sending off Argentinian Antonio Rattin. The referee had not made his decision clear during the game, and England manager Alf Ramsey approached FIFA for post-match clarification. This incident started Aston thinking about ways to make a referee's decisions clearer to both players and spectators. Aston realised that a colour coding scheme based on the same principle as used on traffic lights (yellow - caution, red - stop) would traverse language barriers and clarify whether a player had been cautioned or expelled. As a result, yellow cards to indicate a caution and red cards to indicate an expulsion were used for the first time in the 1970 FIFA World Cup in Mexico. The use of penalty cards has since been adopted and expanded by several sporting codes, with each sport adapting the idea to its specific set of rules or laws.