Hi
chipper33444,
Isn't your game file also using a .BMP for the alpha channel? If so, a basic technique of going about your project would be to open the image in Photoshop and save a copy as a .BMP for your player's head shot. Then make a selection of the head and fill it with white. Inverse the selection and fill it with black. Save the result as another .BMP for your alpha channel. As techniques for making selections are extremely varied, depending on the background and subject contrasts, you would have to post a sample for more specific suggestions.
Here's a thread which addresses making selections, with tutorial links.
http://www.photoshopgurus.info/forum...ction+tutorial