I just got a new iMac, and installed iTerm (0.10). On my last laptop 256 color mode worked fine, but I'm having trouble getting this to work on my new Mac.
I copied over all the settings, set $TERM to xterm-256color, but no dice.
I changed my .vimrc to the absolute minimum to try this out:
set t_Co=256
syntax on
Tried multiple colorschemes, too.

let t_Co=256, not set. Any results? stackoverflow.com/questions/3761770/… – Nathan Greenstein♦ Jan 16 '11 at 19:43