I think it would be very interesting to place Collies in the overall dog color genetics story. There were already some discussions on white dogs, so it should be a good subject to start. Sorry about my not-so-good English, I know I should probably find the original texts and paste them here... but this is shorter and easier...
There are 3 basic ways the dog can be white:
- Phaeomelanin dilution
- Merle
- Spotting
Phaeomelanin dilution is said to be caused by the Chinchilla Allele. It turns red pigment (phaeomelanin) into light red, cream or pure white. Here's an example of how it works...
Many white dogs - like Samoyed, Westie, Maltese etc... - are in fact genetically red dogs. Their eyes, eyelids and lips are always dark. They should not have trouble hearing, because (although they appear white) they don't lack pigmentation.
This has nothing to do with Collies, so let's move on...
Merle dilutes black pigment (eumelanin) randomly into silvery-blue with black splashes. A dog with one copy of that gene will have normal merled coat. With two copies, the result is some to most of the coat turning white due to the lack of pigment. Deafness or blindness can sometimes occur, but they can't be inherited separately from the lack of pigment caused by two merle genes. Normal heterozygous merle dog should never have any more health trouble than any other color.
Merle was already heavily discussed here, so I believe this will be enough...
Spotting is much less discussed, and in my opinion incredibly interesting. It is the gene that causes typical Collie white markings. It also appears in other breeds, in greater or lesser degree - Bernese, Basenji, Tornjak, Foxterrier, Bullterrier, Dalmatian, Dogo Argentino...
White areas on these dogs contain no pigment... so theoretically, these white headed dogs have a chance to be blind or deaf.... however, that chance is not as big as in double merles, because spotting gene acts less randomly - it "takes care" of the important areas (eyes, ears...), making them least probable to lose pigment cells.
This photo illustrates pigmentation pathway in a mouse embryo (same applies to dogs)
photo courtesy of G. Barsh, Stanford
http://homepage.usask.ca/~schmutz/pathway.html The melanocytes are migrating down from the neural crest derived cells along the spinal column and brain. Eyes and ears almost always have some pigment, and last places to recieve pigment cells are toes, chest, tip of tail, tip of nose...
Spotting gene roughly determines when will this migration stop. For example in Dogo Argentino it stops almost immediately, leaving the whole dog white. In Labradors it goes all the way, leaving maybe a small spot on the chest or toes. Collies are somewhere in between.
Besides the spotting gene, white markings are also influenced by external conditions. For example - if the mother has some sort of trauma in pregnancy that disrupted melanocyte migration, it can happen that puppies have more white markings than usual. That's why we can never predict exact amount of white markings some parents can give.