Light Butter is a term used to refer to a butter with less butterfat content than normal. It does not refer to the colour, so don’t go looking for the opposite, a “dark butter”, unless you mean “brown butter.”
Light Butter is made from pasteurised milk, and is almost always made industrially — e.g. you won’t see it sold at farmer’s markets.
What makes Light Butter lighter in butterfat is the addition of air and water to replace the butterfat.
As it is primarily meant to be a spread on bread, muffins, etc, it is easy to spread. For use in cooking, it can be gently heated, but it is not really meant for baking. It is not good on popcorn because of the high water content.
Exactly what the butterfat content is depends on where you are.
In France, by law, Light Butter means a butterfat content between 41% and 65 %. In France, any butter having less than 41% (in practice 39% to 41%) butterfat gets moved out of the butter classification and into the category of a “dairy spread” (“spécialités laitières à tartiner.”) Demi-beurre falls in this range, and so is a Light Butter. In France, no other source of fat in Light Butter is allowed other than butterfat, though there may be other additives such as starch to give body.
In Canada, regular butter must be 80% or greater butterfat content, though in practice dairy producers almost always only supply the minimum that they have to. Light Butter in Canada is classed as being between 39% to 60% butterfat by weight .
In the UK, regular butter must be 80% and up butterfat. Light Butter is classed as being 39 to 41% butterfat.
In America, regular butter must be 80% and up butterfat. Light Butter is classed as being 40% or less butterfat. It may also be called “Reduced-Fat Butter.” It may contain gelatin to give body. If a particular make of Light Butter can’t be used in baking, the label must state “not recommended for baking.”