There are two easy methods to create an alpha channel in Photoshop.
The first is:
Select your object first by pressing and holding the CTRL key and then right click on the layer you want to select. Then, switch over to the CHANNELS menu. At the bottom of the menu window is a small box with a circle in it, that's the Save Selection as Channel button. Clicking on it will give you an exact alpha channel layer for the object you've chosen.
And a simpler method is like this:
1. Create a new layer and fill it with black.
2. CTRL + LEFT CLICK the layer you want to alpha. Fill it in with white.
3. Save the image.
4. Import the image into the TRANSPARENCY of the shading group that you're using.
Done. Easy huh?
Dave Baer
Professor of Digital Arts
Digital Media Arts College
Boca Raton, Florida
dbaer@dmac.edu