Following on from Mondays Post:-
Now generate a Layer Mask by clicking on the Layer Mask button. Make sure its active with a double border (2nd thumbnail added to the orignal color thumbnail in the layers palette.)
Now select the Gradient tool (Tap "G") and observe in the options bar:
a) change the type of gradient to "Foreground to Transparent" by clicking the second pull-down to reveal the gradient thumbnails. F-to-T will be the first icon.)
b) in the next row of icons set the style of gradient to Linear.
Tap the letter "D" to return the colors to their default.
Now drag the Gradient tool in the image in the direction you wish.
Presto… color to grayscale.
If this does not suit you click undo and try again. The best way is to drag a very short gradient near the center of the image to make a very quick transition. Dragging a longer pull with the Gradient Tool generates a smoother transition.