The best choice that describes the effect of the Proclamation of 1763 on the relationship between Britain and the American colonies is:
(Choice C) Tensions increased between Britain and the American colonies over territorial expansion.
The Proclamation of 1763 was enacted by Britain to prevent colonial expansion beyond the Appalachian Mountains in order to stabilize relations with Native Americans. Many colonists, eager for land and expansion, felt restricted and frustrated by this proclamation, leading to increased tensions with Britain.