Transparency works for NN6+, Firefox 0.9+, and Internet Explorer 5+. It's awesome. First off, you will need to use CSS with whatever you need to make transparent. Here's the attributes you need to set. 80% opaque (mostly there) is defined nearly the same way for the different attributes.
filter:alpha(opacity=80); -moz-opacity: .80; opacity: .80; zoom: 1;
zoom: 1; line is there to force Internet Explorer to have a magical "hasLayout" property. Just a workaround.
Take a look at transparency.js to see a function that sets the opacity of an element. To use this function, just set the 'id' attribute in an HTML tag (image, form, table, div, etc.) and and pass the 'id' name along with the opacity (50 = half opaque, 99 = nearly completely opaue).
Here is a textarea and a pulldown list. To get the pulldown list to work, you need to specify the style for each option. I set the style attribute in the option, but you could do this more appropriately with a class or style sheet instead.
Moving your mouse over this image will make it fade away almost completely. Moving your mouse away will let it come back again.