Sheila New, 70, spent £500 sprucing up her home in Crewkerne but has now been told her paint-job on the Grade II-listed building breaches planning regulation.
Mrs New, who failed to win retrospective planning permission, branded South Somerset District Council "Nazis" and said she would risk arrest rather than return it to the old colour.
She was only "caught" when a member of the parish council saw that the cottage was no longer yellow, in keeping with the other Hamstone buildings in the village.
Failure to comply with the council enforcement order and repaint could land her with a fine and a criminal record, council officials confirmed.
Mrs New told the Daily Telegraph website: "This is like the Nazis. They had rules and forced people to do things they didn't want to.
"I have spoken to dozens of people in the village and they all say how nice the cottage looks and how ridiculous the council are being. It's such a dreary town, I don't know how they can stop anybody trying to bring a bit of colour to brighten it up."
A spokesman from South Somerset District Council said: "As the local authority we have the responsibility to make sure changes to listed buildings are in keeping with planning legislation.
"The colour doesn't fit with local policies so we have to ensure it returns to the original yellow colour or the golden browns and beiges that characterise the local area.
"Planning officers will be very happy to advise Mrs New on the colours suitable for the building to make sure it is appropriate and within the protective consents afforded to the listing building."