Step 5: This is where MSPaint comes in. Copy your cropped and resized, soon-to-be avatar (either Ctrl+C via the keyboard, or Edit-->Copy), then open your MSPaint program (do NOT close your Adobe Photoshop yet--you'll need again, later). Once you've opened your MSPaint, "Paste" in your avatar in the "Untitled" document already there for you.
Step 6: So we'll have an easier time applying the "transparent" design, we'll need to zoom in, or enlarge our view of the avatar. To do that, go to View-->Zoom-->Custom. A small window will pop up, asking for how much you want to enlarge the view of the picture. Pick the highest: 800%.
Once you've picked 800%, press 'OK'.
If 800% is too big for you, feel free to view your avatar at a smaller zoom. I usually go by 600% or 800%, but any smaller and it's quite difficult for me.
Step 7: Now we're ready to design the avatar. First off, you may want to put a solid border around your avatar. So choose the icon that features a solid shape of a box, and from the top left hand corner of your avatar, draw the box all the way to the bottom right hand corner of your avatar.
Step 8: How you design your avatar is basically up to you. It's all about experimenting, going through trial and error. But here's some tips on how you can design your avatar. For one, you can choose the icon that has the straight diagonal line on it. Then with it, draw some boxes in the corners, like some sort of pattern. Don't forget to also make space as to where you plan to make cut offs, or where the transparent places will be.
Step 9: You can also pick the paint brush tool (the icon with the paint brush picture). As you choose it, you'll also notice that a set of shapes and lines show up in another box below the default tools (as outlined red in the picture below). Choose the diagonal line, and you can draw some diagonals in your avatar.
Step 10: Design your avatar as much as you like till you're satisfied. Once you're done, color in all the parts you want to make transparent. In the colors palette at the near bottom left of your paint program, choose any new color that is NOT in your image (since we'll be choosing to make that color transparent later on). With your chosen color (like bright magenta) color in the areas that you want transparent.
Go to Zoom-->Normal size to return your avatar back to it's 60x60 size.
Now we're ready to save our avatar as a .gif; move on to the final page.