Try this...

step 1. create a new layer (make it the color you want the background to be)

step 2. click on the "layer mask" icon to create a mask

step 3. select the blend tool and change your color to black (anything black will blend into the background)

step 4. drag in the direction you want the fade to be.

This method is non destructive and allows you to experiment more with the fasde without altering your image.

:)
retrocity