Making overlays

I know this seems like a google question, but call me a frickin’ retard, but I couldn’t find shit.

How do I make an overlay texture?

As in, how would I allow the texture to be transparent in places in both the .vmt and .vtf?

Thanks in advance.

what program are you using?

if you’re using photoshop use this

In photoshop:

Open the photoshop, and make a 1 layer with transparent background (checkers)
Then you make shape or whatever you want there to be, text or whatever. And then you go to channels in layers window. And press create new channel, it creates a channel called Alpha 1
Also all your image will fill with black color. Don’t worry, then go to “Layers” again, Hold Ctrl and click on your image layer. And fill it with white color.

Solid white = Solid!
The darker the more transparent it will be!

in vmt, you just specify:

"$basetexture" "path of texture"
"$translucent"    "1"

And that’s it.

Some pics to make it clearer:

oh and btw I suggest you use vtf plugin for photoshop.
Just select compressed texture with alpha


Thanks dude. That’s really useful.