Hello Everyone,
I’m looking for the best quality for my GUI and one thing I’ve noticed is that my transparancy on some images are not as good as they are in Photoshop. I’m considering buying Scaleform and learning, but honestly I’d like to do better with what I have. So my question is…
Which is better for GUI utilizing the Alpha Channel. PNG or TGA?
It’ll make little to no difference at all. What is going to be most important is that you make sure your textures have are set to the UI lod group and compression option.
What ends up in the background of the transparency will be different between the two. I recommend using tga because you can then put the color you want on the transparent area so you can avoid possible border issues on the edges of the alpha.
From a programmer standpoint, I prefer TGA due to its minimal 18 byte header and straight forward data storage…
Makes it easy to write own texture tools 
That also depends on the applied compression setting of the texture asset.
Some have trouble with hard egdes in the alpha.
For some, like signage, I have to use the uncompressed “EditorUI” setting…
How would I go about setting up the transparency? I tried it and I couldn’t get it to work properly.
Change the material property from “Opaque” to translucent. Then drive the translucency with the alpha channel.