Hi Rennie, a quick and easy way (and NON destructive) would be to use a mask so your first image would blend into the underlying image.

step 1. Select the layer that has your first image and click on the "layer mask" icon to create a mask (this is the second ICON located at the bottom of the Layer Palette)

step 2. Select the gradient blend tool and change your FOREGROUND color to black (anything black will blend into the underlying image)

step 3. Drag in the direction you want the fade to be.

Play around with the Beginning and End point of your "click-and-drag" to change the blending effects between images.

This method is non destructive and allows you to experiment more with the fade/blend without altering either of your images.

:)
retrocity