How do i make the a picture fade in the background liek that? im using adobe photoshop 7.

get your picture that you want in the background ..
choose a background color
paste the picture (in a new layer)
look on the layer pallete ( bottom right)
change the blending options till you get it the way you want . (blending options are in the drop down menu on the layer pallete make sure that you change the options of the layer with the picture not the bground color layer)

If you're talking about the "watermark"-type image in the background, just change the opacity for the layer. The opacity slider is on the layer palette in Photoshop.

Yea, just lower the opacity.

Oh ok thank you!