What it means
Said when you’re properly jealous of someone else’s good fortune, new gear, big win, whatever. The image is that envy turns you a bit green in the face, like you’re feeling sick with it. Usually it’s tossed out with a grin so you can admit you’re jealous without making it awkward, but it can be dead serious too.
Usage examples
"She posts her beach holiday pics again and I’m sat at my desk, pretending I’m fine, absolutely green with envy."
"She showed up in a brand new convertible and the whole street was green with envy, curtains twitching everywhere."
"I’ll admit I was green with envy when he got the window seat with the mountain view and I got the aisle by the toilets."
"You got upgraded to business and I’m back here knees in my chest, fully green with envy."
"He turned up with the new PS5 bundle and even his own cousins were green with envy."
Where it comes from
This one’s properly old. English has linked green with sickness and queasy looks for centuries, and Shakespeare gave jealousy extra teeth with the green-eyed monster in Othello. Those two threads ended up melting together, so green with envy became the standard picture for looking almost sick with jealousy.