Advanced photoshop gradient question

I want to do an opacity gradient fade from one layer to another. So, I will have a back layer, let's call it background. Then I have a layer in the foreground, called foreground layer. I know, this is a creative naming convention.

Anyways, I want to fade the foreground image slowly at the edges, to make the transition between the foreground and background layer seemless. The only way I have found of doing this is by setting the eraser opacity to five percent, and just touching up the image until I get the desired effect. But I do remember somewhere an opacity gradient fade... I just don't remember how to get to it. Anyone have an idea?

You want a layer mask. Should be under the layer menu. It will let you paint in b&w to control the opacity of your foreground layer.

Solved the problem using the quick mask mode. Works perfectly.