Comment » Optimizing PNG Images for Older Browsers
Sitepoint had a great article in their newsletter today on how to optimize PNG images to avoid a gray background in older versions of IE. (I've linked to the original post on their forums.) The end result is that the transparent part of the images will display normally in IE7/Firefox/Safari/Opera etc and degrade gracefully for those still using IE6 and below. No hacks, not extra code, no conditional comments - just a minor adjustment while creating the image.
You will need Fireworks - according to the author this technique isn't possible in the popular image editing programs Photoshop, GIMP, or Paint Shop Pro. In a nutshell, you set the file format to PNG-8 with alpha transparency, and the end result has semi-transparent colors. The better browsers will recognize the semi-transparent colors, and display the image properly. The older versions of IE will treat the semi-transparent colors as fully transparent colors, and render the image like a GIF. (The image may appear thinner/choppier, but will have a transparent instead of gray background.)
