Fill it with gradient.
Use Layer styles.
Use layer mask and black to white gradient to blend the lower border.
Here is layer order results.

Now, make another selection. Further it (CREATE a NEW Layer before Filling it) and use White to transparency gradient on it.
Result:
Use Layer styles.
Use layer mask and black to white gradient to blend the lower border.
Here is layer order results.
Now, make another selection. Further it (CREATE a NEW Layer before Filling it) and use White to transparency gradient on it.
Result:
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Tutorial Series
This tutorial is part 2 of a 2 part series. Other tutorials in this series are shown below:
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How To Make An Icon Tutorial





