There are several ways to work around but the one that has worked for me is this: (I'm assuming your are trying to place a decal with a rectangular layer into an object) 1) make the Texturemap (save as TIFF)Don't use jpgs or gifs 2) Make an opacity mask (black and white) also save it as TIFF. 3) Apply the texture map as a rectangular layer. 4) In the Transparency channel add a Rectangular layer with the same dimensions as the texture map and place the opacity mask there. I don't remember ir white is invisible or black, but If make it wrong, just check the "invert" option. 5) I think that eliminates 100 to 99 percent of the halo. I hope this helps...