Often confused with a neutral color scheme, the distinction lies in the degree of saturation and vibrancy within the palette - with a muted color scheme specifically focusing on colors that have been toned down or softened, rather than a lack of color.
Considered neutral because they don’t lean towards any particular hue on the color wheel, a neutral scheme tends to comprise shades of whites, grays, beiges and muted brown to create a blank canvas from which to layer other elements of design.
On the other hand, a muted color scheme specifically leans towards the warmer ends of the spectrum with tones like dusty rose, soft sage, and ruddy blues coming to the fore - colors that retain a certain level of saturation, but lack the boldness of their brighter counterparts.