The last battle in The Legend of Zelda: Majora's Mask. At first Link is transported to a rather serene meadow, but then after talking to the lone boy by the tree wearing Majora's Mask, he suddenly ends up in an altered dimension with a vortex of colors.
In 3, you fight Arkham (who is, at the time, a black blob with purple streaks and four legs) in some kind of shallow pool of various shades of purple and pink with a lot of black spots thrown in (Said black spots being the eyes and mouths in the faces of the souls of the damned that make up said pool). And the exploding dolphin things he summons for you to fight to fill the time are also writhing in technicolour energy. Throw in your hero Dante's red coatand Vergil's blue one, and the only trippy colours you're missing are green and yellow.
Subverted in Bomberman 64. Sirius activates the Omni Cube, and you basically fight on a floating grate inside a giant version of the cube, complete with a space-y background. Then after some fighting, Regulus shows up and attacks the cube (floating just out of reach the whole battle), bringing you back to Sirius' throne room.
In Otogi: Myth of Demons, you fight the Big Bad Michizane in a pocket universe where he has been burning/bathing his body in the light and flames of eight million stars, growing ever more powerful and becoming a Physical God. And in the Sequel you fight the Nine-tailed Fox in the upper atmosphere of the planet, with snow and ice covered chunks of ground floating around.
The final battle of Castle Crashers starts on a flying platform with a glowing red crystal encased in a wall of rock in the background, as the fight goes on, the wall of rock slowly gets destroyed until the platform you are on starts FALLING mid-battle. The boss himself gets pretty wacky as well.
In the second D&D game Shadows of Mystara, you fight in one of these against an evil ghost-thing named Ezerholden. Depending on the path you take you might also fight a revived Deimos in a similar trippy temple setting.
The final battle in Violent Storm with the boss of the Monster Clown turns out to be against a small child who is a cross between Garlic of Dragon Ball Z and Tetsuo from AKIRA. The castle lifts up into the air and into an alternate dimension as he becomes gigantic and malformed and bulky like Zarbon.
Played in the Mario Kart games, as well as F-Zero GX, where the last raceway is a rainbow-colored hologram track high in the night sky.
Sonic R, despite not having a boss, has something like this. The final level you unlock is a glowing racetrack apparently made of a rainbow or something.
It's more likely it's a racetrack inside/made out of a/the Chaos Emerald/s, considering Super Sonic's presence on the racetrack changes the music and lets you beat the game for real. It doesn't happen on any other racetrack.
The final race in Sonic Riders: Zero Gravity takes place inside a black hole on a mobius strip track with a dark stormy psychedelic backdrop.
Zone events in Wipeout HD and Zone Battles in the expansion Fury take place on a hologram of the track that starts out with all white surfaces and muted music. As the player gets to faster Zone categories, the music get louder and heavier, the track gets a progressively more intense color palette, and the track surface starts showing media-player-esque music visualizations. By the time you hit Zen, between the speed you're flying and the intensity of the presentation, you'll know exactly why the game comes with one of those unskippable seizure warning screens.
The final boss battles in all of the games in the Soul Series.
Prominent in Soul Edge. The second to last battle: at a quiet port in Spain. The final battle: the same port (or chunks of it) drifting through trippy vortex-y space. The name of the BGM of this arena: "World Atlas Collapsed."
The only exception to date is in Soulcalibur II, where Inferno (the soul of the evilswordSoul Edge) is fought in a stage called Tartaros. However, the trade-off is that you're fighting in the traditional depiction of Hell.
Guilty Gear XX, the battle with I-No is fought in a black void with swirling red clouds and lightning strikes in the background. The screen will also Fade to Black when she unleashes her Megalomania super special attack, one that you can't use when controlling her... unless you're playing Slash and beyond as EX I-No. The chances of a non-CPU opponent falling for it are slim, making it kind of a moot point.
The fight against Master Hand in Super Smash Bros. takes place on a single, flat platform before a swirling void. The fight with him in Melee starts in the same spot ("Final Destination") but then warps out of there, eventually flying over a sun-lit field. The in-game explanation is that as the fight goes on, it transfers to the "real" world.
The prototype Final Destination (mentioned above) in the first SSB arguably counts as well. You begin the fight in space/a starry-lit sky with tons of shooting stars in the background, which then shifts into what appears to be the inside of a purple nebula, and finally a blue vortex that becomes more and more unstable as you whittle down Master Hand's HP.
Brawl has two Amazing Technicolor Battlefields: the Tabuu fight stage and the new Final Destination.
The stage the Tabuu fight takes place on could be considered a Continuity Nod (or perhaps Internal Homage) to the above-mentioned original Master Hand stage - the background is very similar, and the platform looks almost identical, only this time it's made of... glowy...energy... wing-shaped... stuff.
Battlefield in Melee also counts.
Also to be considered is the battlefield in Brawl's Great Maze in Adventure Mode, whenever you fight a cloned version of one of the fighters.
In Dead or Alive 3, you face off against Omega/Genra in a field surrounded by flames. Throughout the whole battle, the camera is shown at an over-the-shoulder angle, and the screen displays a perpetual motion blur.
The final battles in The King of Fighters '97 are pretty bizarre. The fights with Orochi Iori/Orochi Leona has the entire background turning red as a kind of symbolism for their current predicament (The Riot of the Blood), and the battle with the Orochi Team takes place at an altar where the elements change constantly: first, it's covered in purple flames, then a lightning storm rages, and then it's surrounded by magma. When Orochi himself shows up, weirdly coloured shapes and patterns flash by in the background. None of this is explained in-game.
In The King of Fighters '98: Ultimate Match, the stage select lists the latter two stages (which are apparently the same stage) as a "Different Dimension." The former examples are listed as "Bousou" ("Delusion") stages, which lends more credibility to symbolism. Magaki's stage in XI, "The Different Space", is similar in some regards: The floor in the background is alit with blue flames and an odd sphere of light hovers in the middle of the stage. Luckily, that's about it. Bear in mind that Magaki travels via pocket dimension and it makes a little more sense.
The final battle with Jivatma in Maximum Impact 2 takes place on a marble floor, surrounded by a starry field. As it only appears after Jivatma snaps his fingers, this is probably an illusion.
Orochi, Mukai, and Magaki can all create Amazing Technicolor Battlefields with their Desperation Moves (Orochi and Magaki use rays of light and Magaki's attack in particular resembles an acid trip; Mukai attacks with pertrification waves of white and grey energy to achieve a similar effect). Igniz's HSDM/MAX 2 in 2002: Unlimited Match encases you in a galaxy, which he then detonates.
The final fight with Hyo in the first Rival Schools takes place in a multicolor light-show stage called "Illusional Space", created by his hypnotism powers according to the story.
Star Gladiator's True Final Boss fight against Ghost Bilstein takes place from within a strange multicolored spinning tunnel-like dimension that has shape-changing pulsating lights and images flowing from within the background while the fighters battle from upon a circle-esque ring that has a pulsating blue-purple aura image. Unlike the previous fights, the loser of the match gets sent hurling into a purple Plasma void.
In Psychic Force 2012, Emilio's last fight from within Story Mode is against his evil side and that the battle takes place from within his own mind, in which the battlefield itself has a lot of creepy red, blue, and purple pulsating shapes and patterns flashing from within the dark background, which is to possibly indicate Emilio's own internal struggle against his psychotic side. It's heavily implied from within his own ending that Emilio loses this fight and is now trapped from within his own mind while his psychotic side is allowed to be free and continue his Ax-Crazy rampage.
Happens in the first Samurai Shodown game, when, after winning one round against Amakusa, he does soemthing that makes the whole stage look destroyed and covered in multicolor flames, and the huge stone in the background opens to reveal a glowing, winged demon. The music also changes greatly and his AI gets somewhat improved. Curiously, after you win, the stage goes back to normal. Another example would be the final battle of Samurai Shodown 2, which takes place in hell and, accordingly, the stage is filled with bizarre visuals.
Emerl's multiplayer arena from Sonic Battle pretty much fits; it's a plain black background, and the entire foreground (i.e. the stage itself) is made up of a holographic-neon framework.
The stage "The Portal" in Mortal Kombat II has the combatants (sorry, kombatants) fighting on a stony ledge in front of a swirling red void.
Team Fortress 2: Activating Pyrovision changes the textures to a psychedelic effect (though the skybox color remains the same).
Several fanmade maps, such as KOTH_Always (a map fashioned after Robot Unicorn Attack) are also like this.
Light Gun Games
Any fight against any of Anubis' incarnations in Battle Clash or Metal Combat.
Interestingly, it's the BOSS of one of the Time Crisis games that invokes this himself and not the stage. He's in a suit made of mini-TV things that render him invisible. When not in use it looks like he's wearing a suit made from no-signal-received analog TV screens
World of Warcraft has a couple of these. The battle against Malygos, the Dragon Aspect of Magic, takes place in the Eye of Eternity, on a big floating rock platform surrounded by stars. During the fight, Malygos uses his breath to destroy the platform, which coincides with the entire background going into brilliant swirly colors. There is a bug where the colors occasionally don't go away once the final combat phase starts, causing severe problems for sensitive players. And Malygos isn't even the Final Boss of the game.
The Bonus Boss, Algalon the Observer Raid Destroyer, in Ulduar, is initially encountered in an observatory which turns into a starry outer space background once the fight is engaged. It makes sense, since Algalon is sent by the Titans themselves and looks like a humanoid constellation.
Outland in its entirety could arguably be considered this, as the shattered planet floats through the psychedelic colors of the Twisted Nether.
The For The Horde! achievement has the fight against Prophet Velen inside the Exodar- which is already one of these (Well, for The Horde anyway- it's a city to the Alliance), but Velen's suped-up priest abilities set off so many particle effects, it goes Up to Eleven.
The Lich King battle in Icecrown Citadel probably also counts. When your soul gets sucked into Frostmourne, it looks like this◊, with huge spectral chains swirling through the air.
The third form of Dark Falz in Phantasy Star Online levitates you on a ring full of colourful glyph symbols high up in the air with the ground viewable below. Not only the stage, but the boss counts as well, with garish technicolour wings and a blazing bright sword-arm.
Mega Man 2's final boss is an alien thing against a black starry background... but it's all smoke and mirrors. The Sigma stages in Mega Man X 5 are probably the trippiest, though.
Each final boss in Mega Man Battle Network does this. We go from orange streaks in the first game to the background dissolving, being absorbed by a giant amoeba, swirly cosmic stars and planets, peoples' souls gathering, and finally trippy, psychedelic tye-dye designs in the final game.
Those are only notable examples, though, as every single battle takes place in a trippy battlefield.
The last boss fight of Ratchet & Clank: Tools of Destruction against Emperor Tachyon takes place in an asteroid field on top of a relatively great asteroid. This is after the initial part of the fight is over though.
In Dynamite Headdy, when Headdy finally reaches Dark Demon, he whisks the throne room away, transporting himself and Headdy to an area with nothing in it but zooming psychedelically-colored clouds, stars (or something), and invisible ground. This reverts to the throne room when he is defeated.
In Kirby Super Star, you fight Marx (who went One-Winged Angel right after his plan is revealed) in an area that consists of a purple ground with stars on it constantly moving (yet you're not affected by it), with small suns peeking out from the distance, all with a space background behind it. It even glows red and green when Marx's health is two-thirds depleted in the Video Game Remake. However, this was one-uped on by the battlefield of said remake's exclusive boss Marx Soul, which is more drug trip induced.
In Kirby's Adventure, you fight Nightmare in the moon, which is a high speed, shiny blue version of the above example.
The final part of Kirby's Dreamland 3 takes place on the Hyper Zone, an area consisting of a blue background with black clouds floating everywhere at a high speed (in the Boss Rush instead with high-contrast bright colors).
The final battle of Kirbys Return To Dreamland takes place in an extremely colorful alternate dimension, with a floor that looks be made of stars and Popstar being visible through a portal in the background.
Most Kirby levels what take place in space have pretty trippy backgrounds as well.
In The Legend of Spyro: A New Beginning, the game finale took place in an area known as Convexity, which pretty much fit this trope, complete with floating rocks and strange jellyfish-like creatures roaming everywhere. See here.
The final level of Jet Set Radio Future is an odd jumble of a structure in a totally trippy world, away from the Tokyo setting of the rest of the game.
Non-boss fight example: Sonic Heroes, the haunted mansion level eventually turns into this after you hit a certain switch, with a few platforms floating in the midst of chaos. Once you hit another button... The level becomes the outside of a completely normal mansion, and the goal appears.
A third Sonic the Hedgehog example: at the end of Sonic the Hedgehog (2006), the last level and last boss take place in a swirling, mystical void. Somewhat justified in that the boss actually has bitten a huge chunk out of the fabric of reality, and is simply letting that appetiser settle as he prepares to chow down on time itself. Appropriately enough, the area is called "The End Of The World".
Yet another Sonic example: the final boss of Sonic Generations is fought in a violet time void.
Every Beastector battle in Mischief Makers is like this, as well as the battle with Monolith.
In Rayman 3: Hoodlum Havoc, during the final battle with Reflux, the battleground slowly degenerates from being the top of a stone tower, to floating shards of building with a swirly purple void in the background, to an arena bordered by giant space-plants with eyes.
The final level in Mighty Flip Champs! takes place in what appears to be outer space. The background scrolls quickly.
Night Sky features a bonus world called Slightly Nonsense that is not mentioned until you beat the game. Once you complete the requirements to unlock it, you find yourself going through levels with bright checkerboard terrain and unnatural suns, Photoshop-filtered photos in the background, and even a level that's entirely composed of ASCII art! The puzzles here are more quirky (and difficult) than the rest of the game.
A rare Western-RPG example: The Elder Scrolls V: Skyrim's final battle against Alduin takes place in Sovngarde (which is basically, in keeping with Skyrim's Horny Vikings motif, an expy of Valhalla), and boy is it heavily saturated with color, especially as you look up and see Alduin approaching.
ActRaiser: In the finale, The Master faces Tanzra and co. first in a cloudy wasteland, then in a starry galactic field.
Most Final Fantasy games after that have their climactic battles on Amazing Technicolor Battlefields.
Averted in I - III, but only because there was next to no background. Played completely straight in the remakes though.
The fight against Zeromus in Final Fantasy IV. The swirling background scrolls behind him and your party as you fight, and his most powerful attack, "Big Bang", will actually reverse the scrolling for a few seconds before dealing massive damage to your party.
You get the same deal in Final Fantasy V. One of Neo-Exdeath's attacks even declares "The laws of the universe mean nothing!"
Justified in Final Fantasy VI, as Kefka already succeeded in blowing up the world halfway through, and the battlefield you're facing him on is his tower/the ruined sky.
Final Fantasy VIII's final castle is bookended by a psychedelic trip forward through time, and then an even trippier journey backwards as Ultimecia attempts to "kompress" all of time into a single immortal moment for...some reason.
Final Fantasy X's fight with Yunalesca, while NOT the final boss battle in the game, makes use of a totally cosmicAmazing Technicolor Battlefield. Complete with floaty ruins! The final battle against Yu Yevon and the aeons is also an example, only in this one you have to fight the floaty ruins!
Final Fantasy XI expansion Chains of Promathia has a rather neat final battlefield with the characters fighting above Vana'diel. In space.
Dissidia: Final Fantasy's stages are the final dungeon or boss arenas from the main series, so naturally it woulf feature these sort of battlefields.
Par for the course in Suikoden games when the final boss is an incarnation of a True Rune. Averted in IV when facing the giant tree from another dimension whose presence is hinted at during the game. You just fight it in the same room where it's been sitting.
Mother 3 continues this trend just as well— The boss battle against the Masked Man is pictured above (the second from the bottom).
In Kingdom Hearts the final dungeons and the final bosses of each game are usually in an ethereal, unsettling realm on the edge of reality.
Both games seem to be subversions (The PS2 ones): The first has the final fight in the heart of reality itself, a dark featureless void (barring the Eldritch AbominationFinal Boss), and the second (presumably) takes place in the remains of the Very Definitely Final Dungeon....which is a white featureless void.
The DS game then averted it by having the boss fight move between rooms of different worlds for each round, and then back to the place seen just before the battle for the last one. The real final boss doesn't shift from Memory's Skyscraper and is much easier to take down after this.
Played straight with the two fights against Ansem in Kingdom Hearts 3D. The first takes place in a colorful void with twisting tendrils of darkness in the background. The second takes place in a canyon within what appears to be the Realm of Darkness, with eerie glowing lights shining through cracks in the dark surroundings and the aforementioned void relocated to behind the now Stationary Boss. Young Xehanort also gets in on this, his initially plain clockwork dimension becoming progressively more colorful as you damage him, causing the hourglasses surrounding the platform to shatter one by one, scattering their colorful sands into the air. And the very final fight, against a nightmare version of Ven's armour takes place on Sora's Awakening platform, but totally covered in darkness, and periodically switching between black and white.
Dark Cloud's final boss Dark Genie teleports you to a kaleidoscopic purple space, in which you walk on air - transforming into a tentacle monster to make the experience that much more surreal.
Chrono Trigger has quite a few. Lavos's first form (which you get to see early in a Hopeless Boss Fight) takes place on a blueish background with ripples everywhere, as does a late-game boss intimately connected with Lavos. Lavos's "middle" form isn't one of these, but his final form takes place on a field of swirling colors, behind which scenes from the world's history can be seen. Altering the scenes is even one of the boss's abilities "Time warp", and it gains a specific attack spell with each different background. But before all of that, the magician Flea gets a starfield background, even though he's merely a mini-boss.
The Darkness Beyond Time from Chrono Cross. Slightly before that, the battle with the Dragon God might also count, as he tends to change the background on you from time to time.
A variation appears in the original Shadow Hearts; the final battle takes place in space, atop a summoning circle for a godlike alien, projected by a castle/biomechanical space station.
The final battle in Xenosaga Episode I takes place in a multicoloured haze, with no attempt at justification. The battle music also changes from the standard music used in each other battle in the game (including boss battles) to an arguably calmer, less tense piece of music.
The fight against Umaril in The Elder Scrolls IV: Oblivion expansion pack Knights of the Nine. You go through the Final Dungeon, defeat him once, then you fight him again whilst hovering thousands of meters over the Imperial capital.
The final battle in The Legend of Dragoon takes place in a surreal landscape that changes entirely from time to time as the fight progresses.
You can invoke these more or less at will by using Dragoon Specials.
All of the final dungeon in Phantasy Star IV, and the final (hard and above) part of the Dark Falz battle in Phantasy Star Online. Somewhat expected in the former, as the final dungeon (which seen from the outside is a hole in the ground visible from space) is The Profound Darkness forcing its way through the final layers of the seal (which itself takes the form of a solar system) keeping it locked outside of reality.
Done in the previous Installments also except Phantasy Star 1 in which it was just a black background (in itself unusual, as almost every other fight featured a background), but remade into a space like background in the Remake.
The final battle of Baten Kaitos Origins against Verus-Wiseman takes place in a starscape.
In Persona 3 and 4 do this whether it's just a regular field enemy or a boss. Persona 3 really takes the cake for the final boss in both The Journey and The Answer. The Journey deserves special mention because you are fighting inside Nyx itself, and boy doesn't she look awesome!
Dimentio from Super Paper Mario fits this trope to a T. Whenever you fight him, he teleports you to his own 'Dimension D', in which his power becomes 256 times stronger. Regrettably, the player's power is also increased, therefore nullifying the effects.
SaGa uses this quite a few times throughout the series:
Boss X is fought in a realm of a swirling mass of color, giving it a "3D glasses"-like effect. In fact, invoking this trope is pretty much his special power: when his mooks are in trouble, he'll send them and the heroes to one of these (apparently called the "4th Dimension Magisphere"), giving his mooks a substantial boost in HP and power.
Orlouge has a kaleidoscope-esque background.
Genocide Heart can shift the background to any virtual realm it had.
Master Ring is fought directly above the reborn Margmel.
The final boss in Unlimited Saga is fought in outer space on the moon, and you're drawn in towards the second moon on the 4th form.
In the PS1 version of RPG Maker, the final battle of the demo Gobli's Adventure has Gobli fighting solo against Neko in a void with colorful rays of light radiating from a single point (with Neko placed so that it looks like he's in the center of it in the overworld). This same background can be used in one's own game.
The final battle of Freelancer takes place in a gigantic Dyson Sphere. We're talking way larger than any planet; Dyson spheres have a radius of about 150 million kilometers. The whole inside of this thing is covered in one big city.
The setting for Bowser's part of the final boss fight is actually dull in comparison to where Mario and Luigi's part takes place, however; it being in an unspecified, but extremely psychedelic colored part of Bowser's body with parts of the floor and background glowing on and off.
The final battle in Mario & Luigi: Dream Team already has a multicoloured battlefield floor on a creepy rooftop arena, but it then also inverts this trope by having an Amazing Technicolor BOSS in the form of the rainbow coloured, glowing Dreamy Bowser.
In .hack//G.U., in addition to all the Avatar battles and the areas outside the normal game, the very final battle against Cubia takes place in the middle of a yellow-ish tunnel while your party stands on a semi-translucent floor. Well, you have to fight the thing somewhere.
The final boss in Dubloon takes place the darkness of greed, with aura of light emanating from the boss.
The Final Boss battles of both Ys I and II. The former arena is in a starfield, the latter is surrounded by a sea of flames. Likewise for most final battles in the rest of the series.
Seiken Densetsu 3 has two such battles: Zable-Fahr, the Dragon God of Darkness, and the final Big Bad in both Hawk/Lise and Carlie/Kevin's storylines.
In Legend of Mana, the battles against the Lord of Jewels and The Mana Goddess take place in such a battlefield.
In the flash game Epic Battle Fantasy 3, the final battle against Akron is fought in a space-like void. Justified in that Akron's very unsealed presence warps space.
The final boss in Xenoblade is fought as you fly through one of these. In the second phase, he shifts the scenery between this and a beautiful blue sky when he uses certain attacks.
The Granstream Saga has two of these. One is against the final boss, naturally, who is a sapient-can-comprehend-mortals Jerk Ass eldritch horror, and earlier, in a mad scientist's castle. The battle is against his experimental world-ending giant creature, and you have to destroy its heart from inside. While you're fighting the heart blood vessels can be 'seen' transparently from above as if you're really looking down into the battlefield, and the entire room pulsates and shifts with his heartbeats. Both trippy and disorienting.
The battle against Mewtwo in Pokémon Stadium has you fighting him in a void filled with various shades of blue/green and purple with a white Poké Ball design in the center of the battlefield.
Mostly averted in the handheld Pokémon series, where the Champion is normally battled in a small, plain-ish throne room. Played straight however in Pokémon Black 2 and White 2 versus Iris, where the battlefield looks to be in outer space with colorful stars aplenty.
In Pokémon X and Y, the title legendaries Xerneas and Yveltal are fought in a massive chamber made of crystals and on the event horizon of a black hole respectively. And it's awesome. Then you fight Team Flare's boss, Lysandre on the sun.
Shoot Em Ups
Star Fox had this for its classic trippy final boss fight against Andross, with a swirl of colors. Star Fox 64 continues the tradition with a similar eery background, which actually gets weirder when it becomes less trippy as Andross shows his true form.
There were also two secret paths in the asteroid belt that sent you throguh a trippy alternate dimension asteroid belt that nobody in game notices. The second of these is an alternate ending with its own Final Boss. 64 also had two hidden psychedelic warp gates.
The final battle of Chimera Beast takes place in such an environment, the screen from the intro in fact, located at the center of an atomic explosion.
Touhou kind of has this for every boss half the time, as declaring a spellcard changes the background to something abstract. But probably the most in the spirit of the trope is the fight against Toyosatomimi no Miko: The entire final stage is a blue void with spirits of various colours in the background.
Manages to even show up in Pokémon Snap, the photo-safari game. After getting photos of all the other Pokémon, Professor Oak sends you after Mew by launching you on a rather trippy voyage through a strange cosmic realm out of a mid-80s Heart Video.
You get sucked into another reality (with creepy music to add) in the final mission of Ace Combat 3: Electrosphere. Though if you manage to get straight B's, or better, on all of the other missions, including that one, you get yet another mission.
The Rectum in Metal Gear Solid 2. Having fought your way through the corridors of a high-tech but vaguely naval-looking submarine, you arrive in a gigantic void with a platform made of what appears to be data. There are no visible walls, the floor is covered in shadows and there's mist above you, and it's difficult to tell whether you're inside the thing or on top of it. This is lampshaded in Substance, where one of the non-canon Snake Tales uses the setting to represent the void between dimensions.
Last part of the last level of Tactics Ogre: The Knight of Lodis.
The background gets progressively destroyed during the battle until the entire sphere has been demolished.
The entire Other World in the Dragon Ball ZNon-Serial MovieFusion Reborn; the ground is barren and cracked, but the sky is bright with colorful clouds and strange orbs floating everywhere. How little it makes sense just helps to show just how badly Big Bad Janemba messed things up.
In the webcomic Kid Radd, our heroes have entered an RPG game. The battles take place in these, where all you can see is the enemy against the swirls and stripes. The game is based off of Earthbound, of course. Radd and his friends enjoy the trippy feel, for it's a nice change of pace for them; they're more used to platformers.
The final battle(s) against the Anti-Spirals in Tengen Toppa Gurren Lagann are set in outer space, in a very colorful alternate dimension.
Another non-game example comes from Yu-Gi-Oh! 5Ds. Activating the Speed World spell card does this, minus the ever-changing colors. The same is done with the Neo Space card in Yu-Gi-Oh! GX, though the entire battlefield is a rainbow-colored shimmering landscape, including the floor.
This is the second-most attention-grabbing feature in Jersey Jack Pinball's The Wizard of Oz (after the HD screen in the backbox) — the entire table uses color-changing LED lights to change the color of playfield targets and indicators throughout the game.