The extra value that lets a pixel fade
A color image can store red, green, and blue values for each pixel. An alpha channel adds another value: how opaque that pixel should appear. In a common 8-bit format, alpha ranges from 0 to 255: 0 means fully transparent, 255 fully opaque, and values between them allow the background to show through partially.
When an image is placed over another, software blends their colors according to the alpha value. A fully opaque pixel covers the background; a half-transparent one contributes about half its color while letting the background contribute the rest. The same image can therefore look different over a white page, a dark panel, or a photograph.
Why edges look smooth
Alpha is useful even when an object is not meant to look see-through. At the curved edge of a cutout, a pixel may contain only partial coverage of the object. Giving it an intermediate alpha lets the edge blend with the background instead of appearing as a jagged staircase. This is how transparent image files can preserve smooth outlines when moved onto new backgrounds.
The channel does not identify what lies behind the image or make a scene physically transparent. It simply supplies opacity information for each pixel; the application doing the compositing decides how to combine that information with the background. That small extra channel is what lets one image sit cleanly on many different surfaces without baking a solid-colored rectangle around it.
