Hi!
There are several ways to do this. To be able to have control over each flag and each state, I would suggest putting each flag on it's own layer and create a layer mask in the shape of the state.To start, dissect the US States image and create the shape of each state either by creating a selection or a shape. If you create a selection, save it under the Selection menu (Save Selection) and name it by state name so you can find it easily. Creating a selection will save the shape and the location and allow you to apply it eaily as a Layer Mask.
Once you have all the states defined, add your flags--each to its own layer, and name the layer according to the state name. Then with a state flag layer selected, go to the Selection menu and choose Load Selection and choose the appropriate state selection, and click ok.
With the State flag layer selected, and you see the active selection, click the Layer mask icon at the bottom of the Layers Panel and it will automatically mask out everything but the state shape. Now, to move the flag around inside the shape, UNCLICK the link between the Layer image and the Layer mask, and then you can move either one freely around. Make sure you click on the layer image (the brackets at the corners of the image are your indication of which is selected), and move the flag, resize, etc. until you are satisfied. Then I would suggest relinking the Layer and Layer mask back together.
Try one and let us know if you have any quesitons!
Michelle
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