The blood that which flows in the veins of old and aristocratic families.
A literal translation of the Spanish 'sangre azul', attributed to some of the oldest and proudest families of Castile, who claimed never to have intermarried with Moors, Jews, or other races. The expression probably originated in the blueness of the veins of people of fair complexion as compared with those of dark skin.
That was certainly the understanding in the 19th century, and there seems little reason to doubt it. In 1834 Maria Edgeworth published 'Helen', which reiterates that opinion:
"[Someone] from Spain, of high rank and birth, of the sangre azul, the blue blood."