how do i add different colors to an item?

i created a sword using blender
i provided a link of the file for those that wanna look at it.
my question is how do i add more than one color to the sword?
i tried to make the jewel on the handle red and the whole thing turns red even when i just select the faces of the jewel? can someone please help? also how do u make a rise in an object like on this picture?
on the blades that come off the handle?
thanks in advance

To add more than one material to one object (using Blender 2.41):

In the editing buttons (F9) bottom left, it says 1 mat 1, this is the default material, to add another one to your object, click on the “new” button, it will be written 2 mat 2, then go to the material buttons (F5) and add a new material (ADD NEW) choose the color you want; then go back to editing (F9), in edit mode select the faces you want to apply the new material to, once they are selected click on the button assign, and it should work.

it’s in the blender 2.3 guide/ blender manual.