In this paper, a design of vanadium dioxide for dynamic color gamut modulation based on Fano resonance is proposed. This approach facilitates color modulation by manipulating the phase transition state of vanadium dioxide. The device integrates both broadband and narrowband filters, featuring a structure consisting of a top silver mesh, a layer of vanadium dioxide, and a Fabry–Pérot cavity, which allows for effective modulation of the reflectance spectrum. Simulation results demonstrate that when vanadium dioxide is in its insulating state, the maximum reflectivity observed in the device spectrum, reaching 43.1%, appears at 475 nm. Conversely, when vanadium dioxide transitions to its metallic state, the peak wavelength shifts to 688 nm, accompanied by an increased reflectance peak of 59.3%. Analysis of electric field distributions reveals that the intensity caused by surface plasmonic resonance dominates over the excited Fano resonance while vanadium dioxide is in its insulating state, which is the opposite of when vanadium dioxide transitions to its metallic state. This behavior exhibits an excellent dynamic color-tuning capability. Specifically, the phase transition of vanadium dioxide results in a color difference ∆E2000 of up to 36.7, while maintaining good color saturation. This technique holds significant potential for applications such as dynamic color display and anti-counterfeit labeling.