What file format should I use for Web page graphics (Web only)?

1. If your graphic is a continuous tone image such as a photograph, with multiple colors merging into each other, use .jpg. For buttons, text, and any other graphic that consists of clearly defined areas of solid colors, use .gif.
2. Note that the .jpg format does not allow transparency. You can simulate transparency in a .jpg by creating your picture in Elements with transparency (for example by using the eraser on a duplicate image layer and turning off visibility of the background layer). Then choose File > Save for Web. In Save for Web, choose .jpg as your format, and then look for the Matte menu where you can choose a color that will match your Web page background color.
3. The .gif format does support transparency, but it is all-or-nothing. Areas must be either entirely transparent or entirely opaque. There is no partial transparency allowed. In the Save for Web dialog, check the Transparency option. Or you can use the same Matte feature as just described for .jpg to simulate transparency by filling transparent parts of the graphic with the same color as your Web page background.