Students appear in red in Gradebook when they are transferred, dropped, or withdrawn from the course.

To prevent transferred, dropped, or withdrawn students from showing:
1. On the navigation bar, click Options
2. Unmark the Show Students with Historical Information checkbox

Students may also appear in red if they do not have a current status included in grade and attendance entry.
To view statuses included in grade and attendance entry, select Configuration, Business Rules, General.
To change the student's status, open the student record and select a current status included in grade and attendance entry.