This tutorial gets your picture from this:

To this:

1. Firstly open the pictures you want to blend together. I think its best to have 2 at the moment if you are just learning.
2. Get the
Polygonal lasso tool and cut an part where the 2 pictures layer. Here is an example

Do not press delete, leave it.
3. Then get the
Erase Tool and use the brush named
Soft Round size
100.
4. Volia done!