I've tried following example, and it was working fine...

 public struct IconInfo { public bool fIcon; public int xHotspot; public int yHotspot; public IntPtr hbmMask; public IntPtr hbmColor; } 

[DllImport("user32.dll")] [return: MarshalAs(UnmanagedType.Bool)] public static extern bool GetIconInfo(IntPtr hIcon, ref IconInfo pIconInfo);

[DllImport("user32.dll")] public static extern IntPtr CreateIconIndirect(ref IconInfo icon);

 public static Cursor CreateCursor(Bitmap bmp, int xHotSpot, int yHotSpot) { IntPtr ptr = bmp.GetHicon(); IconInfo tmp = new IconInfo(); GetIconInfo(ptr, ref tmp); tmp.xHotspot = xHotSpot; tmp.yHotspot = yHotSpot; tmp.fIcon = false; ptr = CreateIconIndirect(ref tmp); return new Cursor(ptr); } 

And i've put this on button click event (you can call from where you like):

Bitmap b = new Bitmap("D:/Up.png"); this.Cursor = CreateCursor(b, 5, 5);

And the Up.png image is savd with 75% opacity in AdobePhotoshop.

I've tried following example, and it was working fine...

 public struct IconInfo { public bool fIcon; public int xHotspot; public int yHotspot; public IntPtr hbmMask; public IntPtr hbmColor; }    [DllImport("user32.dll")] [return: MarshalAs(UnmanagedType.Bool)] public static extern bool GetIconInfo(IntPtr hIcon, ref IconInfo pIconInfo);  [DllImport("user32.dll")] public static extern IntPtr CreateIconIndirect(ref IconInfo icon); public static Cursor CreateCursor(Bitmap bmp, int xHotSpot, int yHotSpot) { IntPtr ptr = bmp.GetHicon(); IconInfo tmp = new IconInfo(); GetIconInfo(ptr, ref tmp); tmp.xHotspot = xHotSpot; tmp.yHotspot = yHotSpot; tmp.fIcon = false; ptr = CreateIconIndirect(ref tmp); return new Cursor(ptr); } 

And i've put this on button click event (you can call from where you like):

Bitmap b = new Bitmap("D:/Up.png"); this.Cursor = CreateCursor(b, 5, 5); 

And the Up.png image is saved with 75% opacity in AdobePhotoshop.