Minecraft allows formatting text using the section sign (§). But because § can't be typed in chat, many servers allow & instead. Try these format codes in chat, on signs, and elsewhere.
For a server MOTD, use \u00A7 instead of &.
In language files, use the section sign (§), and save in UTF-8 format.
N.B.: Color codes and &r clear any formatting applied, so text formats must be applied after colors.