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To create the transparent text effect, start by opening your image in Photoshop (0:14). Add a new blank layer above the image (0:18) and rename the new layer “Border” (0:33). Fill the layer with white (0:47), and then lower the layer’s opacity to 75 percent (1:04).
Select the Type Tool, choose your font, set your type color to black, and add your text (1:21). Resize the text using Free Transform (2:02).
To make the text transparent, select the Type layer, and then open Photoshop’s Blending Options (2:31). In the Layer Style dialog box, change the Knockout option to Shallow (2:47), and then drag the Fill Opacity slider to 0 percent (2:55). Click OK to close the Layer Style dialog box (3:01), and we can now see through the text to the image below.
Resize the border around the text with Free Transform (3:14), and then adjust the opacity of the border in the Layers panel (3:40).
Noe that If your image is on a layer other the Background layer, you’ll need to place your Type layer and the “Border” layer into a layer group (4:00). And there we have it! That’s how to add transparent text to an image with Photoshop!
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Image from Adobe Stock:
https://stock.adobe.com/ca/stock-photo/manhattan-skyline-with-reflections/52706281