To add some highlight, create new layer, and use large soft white brush to add a spot. Then, transform it (Ctrl-T) - stretch it horizontally.

Change layer blend mode to Overlay.

Next step is to create a cloud. Change forecolor to light blue, switch to Shape tool (U), select Ellipse, switch to 'Add to shape area' mode (2nd button in top row, so that all shapes you create are in single layer). Then, holding Shift, add several circles, overlapping each other a bit.

Add the following layer effects: - drop shadow (black, mode = overlay, opacity 30-40%, distance 3-4px, size 10-15px)
- inner glow (white, overlay, size = 5-6px)
- gradient overlay (black-to-white, mode = overlay, opacity 75%, angle 90)
- bevel and emboss (size 30px, soften 5px, highlight white 75% screen, shadow multiply 40% blue)
- satin (black, mode = overlay, distance 6px, size 14px, try different contours)

Our cloud is ready!

Add another small cloud in front of bigger cloud. When you add layer effects to smaller cloud, decrease all sizes and percents accordingly.

And then, more and more clouds!

Next, we need a rainbow. We will make rainbow with shapes, each color in one shape layer. Create new layer (behind layers with clouds). Set forecolor to red, select ellipse shape tool (U) and make a red circle (as always, holding Shift to preserve proportion)

with Path selection tool (A), select the circle you just made, copy-paste it (Ctrl-C, Ctrl-V), scale down a bit (hit Ctrl-T and resize with your mouse holding Shift). Then change path mode to Substract.

Switch to Pen tool (P), change mode to Substract, then carefully add a shape that hides unnecessary part of circle.

I wanted that the rainbow is cut 2-3 pixels before it connects to cloud. It is very easy to do: select layer with cloud, switch to Path selection tool (A), select the circle that touches the rainbow, copy it (Ctrl-C).

Then go back to the layer with rainbow, click a rainbow path to select it, paste (Ctrl-V), scale up a bit (Ctrl-T, then resize with the mouse holding Shift), and finally, change path mode to Substract.

Now that one color is ready, repeat these steps to create another color.

And another and another, until the rainbow is ready.

Now you know how to create rainbows - why not add some more?

Here goes the trick. I wanted one of my rainbows to 'dissolve' into separate lines, each color flying in separate direction. Here is how to do it: for each layer with color, select the shape with Path selection tool(A), then switch to Pen (P) or Rectangle (U) (does not really matter), change shape mode to Substract, and add a shape that hides part of the circle. Repeat with each color of rainbow - it will look nicer if lines are cut in different locations.

Now we need to add 'flying' lines of colors. We could do that with Pen tool only, but unfortunately Photoshop does not have curved lines with fixed width, or path offset (as Illustrator). And I wanted the lines to have fixed stroke width. So we will have to add paths and then transform them into pixels. So, open Paths palette (from Windows menu), switch to Pen tool, then on bottom of paths palette, click New button. New path will appear (called Path 1).

Start your path by clicking exactly the middle of where red line is cut, and dragging (and releasing) the mouse continuing red line direction.

Continue your path until it is outside document boundaries.

Switch to Brush tool (B), set forecolor to the same red color as the rainbow red, then carefully choose brush size that matches size of rainbow line (in my case, 3px). Then, hit Stroke button on bottom of Paths palette (2nd in the row). You can click Stroke button several times to make line wider. If line does not match, undo and change brush size. You should be careful and patient doing that :-)

Next step is to blur edge of line, to add some depth to our artwork. Turn on Quick Mask (Q), then switch to Gradient tool (G), select black-to-white gradient, and apply gradient as shown here.

Turn off quick mask (hit Q again): you should see the selection similar to this.

Go to Filters menu - Blur - Gaussian blur, and apply 3-5 pixels blur. You can also try Lens blur - it may look better (or not) but take much more time to apply.

Now the red line is completed! Repeat the same steps for each color.

Next step: in new layer, add some very small spots with white hard small brush (add some 1px dots, then 2px and 3px)

Next step: stars. I thought that it it would be more romantic if the stars glow with horizontal and vertical rays. To do such star, switch to Shape tool (U), choose Polygon, set sides = 4, then open Options dropdown window, check Star, and set Indent sizes to 90-97%.

Add a shape (hold Shift to preserve proportions), then transform (Ctrl-T) to squeeze horizontally a little bit.

Next layer: wings (behind all layers of fairy). Made with Pen tool! Apply same effects as to hair layer.

Set shape layer blend mode to Overlay, then in new layer, add a dot with white soft brush....

Ta-da! A fairy! the last step is to add one fairy for each color.

... then set its blend mode to Overlay too!

Add more stars in similar way.

Next step: a fairy! A fairy consists of several shape layers, with layer effects applied to each layer. Here is the shape of the body (made with Pen tool).

Add layer effects: - inner glow (white, overlay 30-40%) - Gradient overlay (black-to-white, radial, overlay 30-40%)

Next layer: arms. (made with Pen tool too)

Next layer: head (made with Ellipse tool (U) and then another shape in Substract mode, made with Pen). Add the same layer effects as to body layer.

Next layer: hair (behind head layer). Add the same layer effects, but change gradient type to Linear.

Next layer: eyes. Made with Pen tool. Change blend mode to Multiply, no layer effects.

View full size Rainbow Wallpaper

That's all!

Thanks! I hope you found it useful.

Author: Vlad Gerasimov
URL:    http://www.vladstudio.com