This is a cool effect to make your text look like it’s made of gel.

1. Open a new document and fill the background with white. I will be using 500×250.

2. Make your foreground color a dark blue so your foreground and background now looks like this:



3. Next use the type tool to create your text.



4. In the layers palette, CTRL+Click on your text layer to put a selection around your text. Now create a new layer.



5. Next go to Select > Modify > Contract and enter 2.



Your text should now look like this:



6. Now fill the selected area with a light blue. Go to Edit > Fill > And select a light blue. Then hit Select > Deselect.



7. Now duplicate the light blue layer and go to Filter > Blur > Gaussian Blur with a setting of 3 pixels.

8. One the light blue text layer, go to the layer blending options:
NOTE: MAKE SURE TO DO THE BLENDING OPTIONS EXACTLY THE SAME!



9. Now your text should look like this:



10. Click the eye on the background layer to make it invisible. Then go to Layer > Merge Visible.

11. Now go the the blending options for the merged layers and add a drop shadow with a 40% opacity.

You are now finished and your end result should look like this: