Yellow occurs in the Australian Shepherd breed naturally. This color originates from the formation of the breed, some of the breeds used to create the Aussie came in this color, such as the Border Collie. This color is more commonly seen in Golden Retrievers or Labrador Retrievers. Yellow is associated with the E Locus, and it takes two carriers to produce, much like the brown color on the B locus, often referred to as "red" in the breed. A big difference, however, between yellow and brown, is that yellow is a masking color. Masking refers to the color the dog appears visually, while the true color of the dog hides "underneath". In our case with Aussies, this means the dog could be a black tri genetically and appear yellow physically. Yellow also masks Merle, so you will not see a yellow merle dog. Depending on the dog's true color "underneath" the yellow, the dog can have a black nose if it is black based, or a brown nose if it is brown(red) based.
Yellow is not an accepted color in the breed standard. It was not a color that made the final cut when that decision was made for the breed. It is considered a disqualifying faulty color in the show ring, and should not be used to breed. There are many colors/patterns that didn't make the cut, this is just one of them. To reiterate, this color does occasionally occur in the breed-often accidentally since this is a color that breeders, including ourselves, do not breed for.
We do want to heavily caution against seeking out a yellow Aussie intentionally. Any breeder who breeds for them on purpose, is often disregarding the breed standard and the very important health screenings required to breed as well. Reputable breeders do what they can to avoid this from happening, as it's not desirable to produce them.
All of this being said, these dogs are very much still purebred Australian Shepherds and have much to offer you as a companion and pet if your ethical and responsible breeder happens to have it occur in one of their litters. They may not be desirable in the show ring, but you can love one just the same in your home.