Here's a demo:
1. open a new image with a white background.
2. create a new layer.
3. fill the new layer with black.
4. reduce the opacity of the black layer to 50%.
The result will be gray, or a 50% mixture of the two layers. This is essentially what happens with transparency. Transparency can be affected with Opacity, and masking in the image, or as a transparency property for the image (which may be what you were talking about having to do with a PNG). I have a tutorial on transparency on my ps6.com website:
http://ps6.com/Tutorials/select.html
choose the transparency tutorial. In there somewhere is a demonstration where I use a transparent GIF to act like a shadow passing over a background. In that image, half the pixels in the shadow area are set to black and the other half to white -- and white is assigned as the transparent color. the alternating black and transparent pixels allow the shadow 'sprite' to pass over the background letting you half see through, and half darken the result. One of many uses.
OK?