Normally, when you create a new image, it will have an opaque Background. Using the Layers palette (see Figure 1), you can add, delete, show/hide, duplicate, group, link, and restack layers on top of the Background. Each layer can be assigned its own blending mode and opacity and can be edited separately without changing the other layers. You can also attach a mask to a layer.
Starting out transparent Click Contents: Transparent in the File menu > New dialog box to have the bottommost tier of a new image be a layer with transparency instead of an opaque Background.
In addition to standard layers, you can also create two other kinds of layers in Photoshop: adjustment layers, which are used for applying temporary color or tonal adjustments to the layers below it, and editable type layers, which are created automatically when the Type or Vertical Type tool is used. If you apply a layer effect to a layer (e.g., Inner Glow, Drop Shadow), a layer effect icon and pop-up menu will appear next to the layer name.
Only the current layer (also called the "chosen" or "active" layer), can be edited. To choose a layer, click its name on the Layers palette.