The earliest theory suggested a Chinchilla gene which was a version of albino. Work by Keeler and Cobb seemed to indicate that the gene producing "silver" or "smoke" in cats was an allele of the same gene that produced the Siamese coat pattern i.e. a form of albinism. They described the effect of silver as and producing the following types of hair (1) all white, (2) all black (in dark silvers or smokes), (3) black hairs with white tips, (4) hairs with white and grey or black bands, and (5) white hairs with black tips. However, this would rule out the possibility of Shaded Sepia, Shaded Mink and Shaded Pointed colours. Since these colours have been shown to be possible in experimental breeding (even if not present on the showbench), the Chinchilla gene theory was obviously incorrect.
A second theory proposed a single dominant Inhibitor gene, but this could not explain the variations of shading. In addition, breeding demonstrated that Smoke cats were genetically different from Shaded and Chinchilla (Tipped) cats and not variable expression of a single gene.
The current theory, and even this may ultimately be disproved, is that there are at least two genes involved and that these interact to produce different effects. There are also a number of as yet unidentified polygenes which may influence the colour and pattern.
Originally, the Inhibitor gene was thought to work similarly to White. In white cats, either the melanocytes (pigment-forming cells) are absent or abnormalities in the cells means that pigment can't be produced. The Inhibitor gene does not work this way.
In silver tabbies, the pigment cells produce far less pigment than normal. Pigment is laid down at the hair tip, but little is laid down on the hair shaft which appears silver or grey rather. If pigment was entirely absent, the hair shaft would be pure white. Sometimes the Inhibitor gene fails to completely block phaeomelanin (the red pigment) and the resulting breakthrough of reddish colour is known as "tarnishing". Tarnishing can often be seen on the muzzles of random bred silver tabbies, but rarely on pedigree silver tabbies (a refinement which sets the purebred version apart from the random-bred version).
In Non-agouti (non-tabby i.e. solid colour) cats, the Inhibitor gene only lightens the undercoat area. Where it fails to completely block residual pigment production, the undercolour is grey rather than white