Colonization is the act of making buildings on new landmasses. It only applies to Sea maps, where landmasses are separated by water.
Cities and FortsEdit
Cities and Forts increase a nation's territory, and have special consideration for building on new landmasses. They cannot be built on a new landmass until a nation has researched Commerce 2 (Coinage). Additionally, the first City or Fort on a new landmass must be near the coast. It can be in neutral or allied territory (but not in enemy territory). Once a City or Fort is built on a new landmass, all other Cities or Forts on that landmass must be within allied territory. Allied Cities or Forts on new landmasses do not preclude you from these requirements; however, this also means that you can build a new City or Fort in neutral territory on a new landmass, even if your allies have already built Cities or Forts on it. The Lakota can continue to build Cities and Forts in neutral territory, but their first City or Fort on a new landmass must be near the coast.
If you capture a City on a new landmass, then that City counts as your first City or Fort on that landmass, and other buildings must be built within its national borders.
If you lose all Cities and Forts on a landmass, it will revert to being a new landmass for you and the above conditions on being near the coast but able to build within neutral territory will again apply.
Other buildings can be built on a new landmass, as long as your own or allied territory extends to it. There is no Commerce requirement, although a Dock (which requires Commerce 1) is needed to travel to another landmass. Other buildings also do not need to be built near the coast (although due to territory, they likely will be). Even economic buildings such as the University can be built on another landmass, as long as it is within city limits. For the Lakota, any non-City non-Fort building can be placed anywhere on a new landmass, as long as it is not in enemy territory. This means the Lakota can make Barracks, Towers, and other such buildings on a new landmass even before researching Commerce 2 (Coinage).