help with transparency

[kibber]

I've created a gray image, imitating a watermark. It is the centered background on all of my pages. I have text which wraps nicely over the grayed image. The problem is when I paste in a black and white scan of a drawing I can't seem to get rid of the white background and the gray watermark will not show through.
I remember a while back I could use fill and fill the white to transparent but I'm running 6.0 and I don't know how to make the white background to my black and white scan transparent.
I've fooled around with the opacity but that just turns the black into gray and thats no good.
Anyone delt with my problem? good tutorial, and I correct in call this a transparency question?
Thanks

 

[jimoblak]

Select>Color Range // select white // hit delete

 

[kibber]

Thanks alot jimoblak.