Develop a friendship outside of work with your colleague. This affords you the opportunity to get to know him outside of work and determine if asking him out is something you really want to do. This could be as simple as attending a few after-work happy hour sessions or asking him if he wants to join a group of your friends for some Saturday morning bike riding.
Pay attention to how he interacts with you. If he is regularly flirtatious with you or you find he touches you, such as a brush against your arm in the hallway or a grazing of the hand when exchanging papers, he may be interested. Pay attention to how much he smiles when he is around you and determine how much he talks to you over everyone else to see if he might like you personally as well.
Ask him to a friendly lunch one day so you can find out more personal details. Before you let him know you want to date him, you need to be sure he isn't seriously dating anyone else. Over lunch, chat about anything that is not related to work. Ask him about his interests and his family, which are natural lead-ins to whether or not he is dating someone.
Allow a day or so to lapse between your lunch and ask him if he wants to have dinner with you. Be direct and confident and make it clear you are asking for a dinner "date" and not a friendly co-worker meal. If he expresses surprise and seems uncomfortable, down play it and make it seem as though it's no big deal. Maintain your smile and say something like "Hey, no biggie. I can meet up with a few of my friends instead. So, see you in the morning so we can get ready for that presentation?" This sets things back to a business atmosphere and let's him know you are fine with his decision.
Relax and enjoy the evening if he says yes. Be upfront and honest regarding why you asked him out. You might say something like "I've enjoyed working with you and always wondered if you were as fun and likeable outside of work as you are at work. I am definitely looking forward to getting to know you better, even if it just ends up being a great friendship." This takes the pressure off of creating the perfect first date and allows you to take down those work-related barriers and enjoy the evening.