Today we'll go through the steps I use to make this type of image. I use Adobe Photoshop Lightroom 4 as my DAM (Digital Asset Management) application, so I start there. The first step is to find the "hero shot". The one that everything else will be focused around. From that shot some basic decisions can be made. What colors will be included, what the supporting shots will be, what sort of brushes will work best to produce the cloud (or halo) around the hero, etc. The set of shots are then opened in the Develop Module (D) and any adjustments are made to the hero shot. The supporting shots are hen synchronized to the shot to produce consistent colors, vibrancy, sharpness and exposure.
In Photoshop CS6 the first thing to do is to open a blank "canvas" at the size you want to sell the native print at. Typically, for me, that's a 16 x 20 at 240 PPI, white background. Once that's set I'll start bring in the shots.
The first shot is that hero shot. I bring it into CS6 and grab the Quick Selection Tool (W). I'll draw through the head shot and down into the torso. You don't have to get everything below the shoulders. That'll just be masked away anyway. Once the Selection is made I'll save it (Select/Save Selection). It's a habit, but it's a habit that's saved my butt more than once. With the Selection still active, just click on the New Layer Mask (looks like a front loading washing machine at the bottom of the Layers Panel [top if you're using Adobe Photoshop Elements 11]). That produces a Layer Mask and drops out the background. The only "edge prep" I do when doing one of these montages is a one pixel feather. I'll use Free Transform (T) if necessary and size and move the hero into position.
Once the hero is in position I'll start making Layers under the Layer containing the hero. I'll make a separate Layer for each color and type of Brush (B) I'll use and label each as I go (i.e. Maroon Clouds, Green Fire, Grey Green Grunge). This gives me an idea what color and what type of Brush (B) I used to create the background effect. This stage can be six to ten Layers deep.
With the base image settled I'll start bringing in the supporting images. I'll cut the out using a Selection and Mask for each one. Each typically gets a Free Transform applied with the Shift Key held down to constrain proportions.
Each image of the person gets a Layer Mask and other Brushes are used to cut away and/or soften the outside edges. By using Layer Masks you can go back and forth by switching the foreground and background colors from Black to White and back.
It's a fun technique. Try it.