How to Fade a Picture to Transparency in Illustrator CS5
Using Adobe Illustrator you can make a picture semi-transparent simply by clicking the "Opacity" setting in the Layers menu. To make a picture opaque on one end and fade to transparency on the other end, you can use the Gradient Tool on a rectangle placed over the picture. You can then use an Opacity Mask to make the picture fade. Experiment with the gradient options and settings to achieve the effect you want. Use a Radial Gradient, for example, to make the picture fade from the center instead of from side to side.
Launch Adobe Illustrator. Click the “File” menu and select “Open.” Navigate to your picture and click the “Open” button.
Click the “Rectangle Tool” in the Toolbox. Drag the tool so it covers the entire picture.
Select the “Gradient Tool” from the Toolbox. Drag the Gradient Tool across the rectangle from left to right. The rectangle becomes gray, fading from white on the left to black on the right.
Adjust the gradient in the rectangle by clicking the “Gradient” Panel. The bar in the middle of the panel shows the gradient used. Click the “Color Stops” beneath the bar and drag them to adjust the gradient on the rectangle.
Note that the picture will be transparent where there is black, and opaque where the rectangle is white. You can reverse the gradient by clicking the “Reverse Gradient” button in the Gradient Panel.
Click the “Selection Tool” in the Toolbox. Drag the tool over the picture and the rectangle to select them both.
Click the “Transparency” Panel. Click the “More” menu on the top right of the panel. Select “Make Opacity Mask” from the list of options. The rectangle disappears and the picture now fades to transparency on the right.