Use pencil tool to draw the lines on the left and bottom edges of the image (or right and top, nevermind). After that, select all (Ctrl-A) and define a <b>pattern</b> from selection (Edit menu - Define Pattern). Then, you can close this temporary image and return to our main image.
Create new layer and fill it with the pattern we just created. To do so, open Fill dialog (Edi menu - Fill), choose Pattern, and then in the list of custom patterns, find the one we need (last one).
oh yes! now we have blue squares in layer 1 and a black grid in layer 2. This is not all yet!
Hold Ctrl and click "layer 2". The black grid should become selection. Then, hide layer 2 (click on the eye), and select layer 1.
Then, simply hit Del button, and you will get the 1-pixel gap between the squares. Why would you need it? Read on!
Now that each square is separated with a pixel of transparency, we can apply layer effects. I used Bevel and Emboss, you can other. Note the values shown in the screenshot: size is 0, shadow mode - color dodge with opacity about 50%. When applying layer effects, always remember than no effects looks better than too many effects. So, be careful when setting the values.