Adding Photos to Frames with Photoshop
How to add your photo to a frame is one of the most common questions asked. A "frame" is basically a file in .png format that has a transparent area where your photo will be displayed. This tutorial will explain how to add your photo with Photoshop.
The Basics
This is an example of a photo frame. This is a one layer file, and note the transparent (in Photoshop this generally appears as a checkered area). Once you've opened your .png file "frame", open the photo that you want to add to it.
Most photos from digital cameras are much to large for web use, so you will need to resize your photo first. In order to determine what to resize your photo to, you will need to know the size of your frame. Go to Image-->Image size, and a small window will pop-up. You will need to note either the height or width of your frame, and then you can resize your photo according. For example, this photo frame measures 444 pixels tall, so I'm going to resize my photo to that same measurement.
For the next step, be sure that you have your Layers window open. If you don't go to Windows-->Layers and it will open. Then, making sure you are using your Move Tool (the arrow tool at the top right of your Tools Window) you will need to click on your photo and drag it over to your photo frame. Now you don't have to line it up perfectly, you just need to have it on top of your photo frame somewhere. Notice in your Layers window, that you now have two layers, and your photo is the top layer.
Click on the top layer in your Layer window, which is your photo and drag it underneath the frame layer. Then again be sure that you have your photo layer selected in your Layer window, and go over to your file, and click and drag your photo layer until appears in the transparent area where you want it to be.
Now, let's say we want to make the photo a little bit smaller, or maybe even rotate it a bit. Maximize the frame file (at the top of your open file you will see a line, a box, and an X. Click on the box), and then on your keyboard hit Control-t, and a lined box will be displayed with corner and edge nodes. Notice when you mouseover the nodes, little arrows will appear. If you click and drag on one of the nodes you can make the photo larger or smaller. Note: At the top of the screen in the toolbar click on the little icon that looks like chain links 
, because that will maintain your aspect ratio and prevent undesirable stretching of your photo.
If you mouseover one of the corner nodes and move your cursor just a little bit away from the node, you will notice that the little arrows will appear at right angles to one another. If you click and drag at this time, you will be able to rotate your image. Once you have it where you want it, click the check mark that appears at the top in the toolbar, and you can then save your image.