Electric field‐induced deformation is studied in a unique hybrid‐aligned nematic (HAN) cell, in which the director of a nematic liquid crystal (LC) with either positive or negative dielectric anisotropy is varied continuously, lying perpendicular to one substrate and parallel to the other. The experimental results show the absence of threshold field in the birefringence–vs–applied voltage relationship as well as the slow variation of birefringence with voltage; these phenomena are analyzed in terms of the Frank‐Oseen continuum theory. Also, the above characteristics of HAN are demonstrated to have such advantages in multicolor LC display applications as low operating voltage and fairly good color separation together with uniform and bright color generation.