amy b over at Flickr has a great example (in photo form) of the whole process involved in remodeling your bathroom.
She takes a kind of drab bathroom and adds mosaic tiles to the shower and a beautiful updated vanity. She does this all while essentially keeping the same color palette, with just a few changes we could spot.
The floor tile brings a darker, yet warmer feel to the bathroom.
And lastly, but probably most importantly, she adds so much room and dimension to the space by knocking down a wall on the right. What originated as a rectangle of a bathroom, now has extra space for cabinets for towels and other storage.
Here's what the bathroom originally looked like...