Condition Green refers to the normal operating condition (cruise mode) of a starship.
It was also a pre-arranged code phrase used by landing parties of the USS Enterprise when communicating under duress. Declaring the party's status compromised, but not in immediate peril, it instructed the ranking officer aboard ship to take no action. It did not, however, prevent that officer from preparing for possible future actions. Nor did it prevent that officer from using considered judgment to exploit an opportunity that aided the party without violating mission parameters.
The use of the word 'green' implied 'all is well' in the context of a fleet using red and yellow alerts, and would hopefully mislead eavesdroppers from understanding the true nature of the code. (TOS: "Bread and Circuses")
This, and other known code phrases like chess code (TOS: "Whom Gods Destroy"), were applicable only under certain circumstances and rarely used. Presumably, such codes were part of a 'play book' devised by Captain Kirk and his officers to cover a wide range of scenarios.