A cell can be shown either isolated (this is the default, if the cell is the current cell), embedded (as a subcell of the current cell) or as the current cell in the context of another direct or indirect parent cell. In the latter mode, the cell is highlighted while the context cell is shown in dimmed or another, user-defined color.
To highlight a cell in a context, first choose the context cell. Then select a shape or a cell instance within the cell to show in the context and choose "Descend" from the "Display" menu or press "Ctrl+D". Now, the first child cell leading to the selected shape is highlighted, while the surrounding shapes of the parent cell (the previous current cell) is shown in dimmed colors. Choose "Descend" repeatedly to descend further into the hierarchy until the selected shape or instance is on the level of the current cell. The current cell is show underlined in the cell tree, while the context cell is shown in bold font in the cell tree as usual.
The reverse of this operation is "Ascend" (or "Ctrl+A") available from the "Display" menu.
The way how the context layout is shown can be adjusted in the setup dialog on the "Background" tab.