Blending modes help determine how pixels on an upper layer interact with pixels on a lower layer, but those upper pixels have to be visible before they can do any interacting at all. When looking at any pixel on a layer, you have to consider four factors about transparency:
^ Whether the pixel has any color to start with ^ The Opacity value ^ The Fill value ^ Whether there's a layer mask
When you add a layer and paint on it, for example, you color some of the pixels yet leave other pixels transparent. (Every layer in every image is completely filled with pixels, whether visible or not.) If nothing is done to color some pixels, they remain transparent, and the lower layers can be seen through that part of your upper layer. In Figure 10-5, the words upper layer are on a separate layer above the layer containing the words Lower Layer. Where the upper layer has transparent pixels, the lower layer shows through.
A layer named Background in the Layers palette can have no transparent pixels.
Lowering the Opacity or the Fill slider in the Layers palette (or the Layer Style dialog box) makes all visible pixels on the layer partially transparent: The pixels on layers below can be seen through the upper layer's pixels. (The Opacity slider controls the pixels on the layer and any layer style; the Fill slider works only on the pixels, not the layer style. In Chapter 12, you can read about the Glass Type technique, which demonstrates the difference.)
Chapter 8 discusses layer masks and vector masks. Remember that any pixel inside the mask is visible, and any pixel outside the mask is transparent, regardless of whether it has color. But, as you can guess, any transparent pixels inside the mask remain transparent.
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