A few years ago I found a way to colorize old photos and posted my first attempts. Colorizing Old Photos They were not perfect, as I will be the first to admit, but I was excited to show the potential.
I have since colorized a few more photos and would like to share the latest one here. I think it looks much more natural than my earlier attempts. It helps that the photo was simple and the features clearly defined.
I encourage you to try this yourself. It really brings the people in old photographs to life.