This tutorial will teach how to make a basic pill button and how to add the aqua (MacOS X) like effect to it.

Lucky owners of Photoshop 7 can skip Steps 1-3 by just making a Rounded Rectangle shape.

Start off by creating new picture (any size). Then press D to set up the foreground color to black. Create a new layer (Ctrl+Shift+N) and make a rectangular selection of the size you want your button to be, using Rectangular Marquee tool(). Finally press Alt+Backspace to fill the selection.

Choose Ecliptical Marquee Tool() and make a round selection on the left end of the button. TIP: Hold Shift, while making a selection, to have a perfect circle. Now select the Rectangular Marquee tool() and add a selection to the previous one, covering the whole area of the button, as shown on the left. To add selections, press Shift before you start selecting.

Press Ctrl+Shift+I() to invert the selection and then press Del to delete everything inside of the selection. Repeat Steps 2 and 3 with right side of the pill.

You should get something similar to the shape on the left as a result of the previous steps. Now choose the colors for your button: a light color for the highlight of the button (Foreground Color) and a dark color for the shadow (Background Color). It would be better if you use shades of similar colors, but you don't have to. I chose light and dark blues.

Ctrl+Click on the layer containg our shape to select it. Using the Linear Gradient Tool() draw a vertical gradient from the bottom of the selection to the top, hold Shift to have perfectly straight gradient. Deselect by pressing Ctrl+D.

Now duplicate the layer (layer -> Duplicate Layer). Then go to Edit -> Free Transform and lower the half of the underlying layer, as shown on the left. Also move the sides into the center a little bit, so they stay inside of the main body of the button. Finally, set the blending mode of the layer to Overlay to get that glowing effect.

Ctrl+Click on the layer containg the main body shape once again to select it. Make a New layer (Ctrl+Shift+N) and move it on top of all others. Fill it with white and set the mode to Soft Light.

Choose white (Hex:FFFFFF) as your Foreground Color. Make a new layer (Ctrl+Shift+N) and paint over it with the Brush Tool() with a Master Diameter about 14 px. Try to achieve the shape, as the one on the preview picture. To make perfectly straight line, hold Shift while drawing. On a background picture I have added the text; you might want to do that at this stage, but really you don't have to worry about it right now. You can add text in the end, but it should be underneath this brushed layer to get the reflective feel.

Apply Gaussian Blur (Filter -> Blur -> Gaussian Blur) with the Radius of 2.4 to the drawing. You need Blur to make it fade out smoother. Also you might want to change the opacity of Reflection layer, if it makes it look better.

Now our button looks very good. It's time to add some type if you haven't added it yet. But pit it underneath the brushing layers. Also you can add more reflections, using the technique in Steps 10 and 11, on the bottom of the bottom. It would make the aqua effect stronger. On the picture on the left you can see a little reflection on the bottom, which I did using smaller brush on a New Layer and setting its opacity to 89%.