The Free Transform command gives access to many transformation tools, including Scale, Skew, Distort, and Rotate. To restrict your transformation temporarily, right-click (Windows) or CTRL-click (Mac) inside the Free Transform bounding box and select one of the specific types of transformations from the list. For creating nice cast shadows, I like to use the Distort option.

7. In the Layers palette, click the first button next to Lock: to lock the transparent pixels in the layer and prevent them from being affected by the next step.

8. Select the Gradient tool from the toolbox and click the gradient sample in the Options bar to select the first gradient, which fills with a gradient between the foreground and background colors. (If you changed your foreground and background colors, press D on your keyboard to return them to black and white. If the background of your image isn't white, click in the background color swatch to change it to match the color in your image's background.)

9. Click with the Gradient tool in the shadow layer, close to your object, and drag away from the object within the shadow. This step fills the shadow with a black that slowly fades to white (or whichever color was in your background color swatch). Repeat as necessary until you achieve the gradient you're looking for.

10. In the Layers palette, click again on the first button next to Lock: to unlock the transparent pixels in the layer and allow them to be edited.

11. Choose Filter | Blur | Gaussian Blur to blur the shadow. Try using a value between 2 and 10 for the Blur Radius until the blurriness of the shadow looks appropriate.

12. To further blur the part of the shadow that is farthest away from the object, use the Marquee or Lasso tool to draw a selection around the farthest 25 percent of the shadow. Choose Select | Feather and feather the selection about 6 pixels. Then, press CTRL-F (Windows) or CMD-F (Mac) to reapply the Gaussian Blur filter with the same settings used in the previous step.

13. To add a slight color to the shadow, click the Layer Styles button at the bottom of the Layers palette and choose Color Overlay. Try Screen as the Blend Mode to begin, and click inside the color sample swatch next to the Blend Mode menu to select the color with which to fill. I like to use the Eyedropper tool to select a color from the shadow parts of the object for which I'm creating a shadow. So, in the case of the shadow I created for the gift box, I selected a color from the front side of the box that is in shadow.

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