I am drawing a polygon with texture on it as part of the HUD in my OpenGL program:

Code :
//Change the projection so that it is suitable for drawing HUD
glMatrixMode(GL_PROJECTION);  //Change the projection
glLoadIdentity();
glOrtho(0, 800, 800, 0, -1, 1);  //2D Mode
glMatrixMode(GL_MODELVIEW);  //Back to modeling
glLoadIdentity();
 
//Draw the polygon with the texture on it
glBegin(GL_POLYGON);
glTexCoord2f(0.0, 1.0); glVertex3f(250.0, 680, 0.0);
glTexCoord2f(1.0, 1.0); glVertex3f(570.0, 680, 0.0);
glTexCoord2f(1.0, 0.0); glVertex3f(570.0, 800, 0.0);
glTexCoord2f(0.0, 0.0); glVertex3f(250.0, 800, 0.0);
glEnd();
 
//Change the projection back to how it was before
glMatrixMode(GL_PROJECTION);  //Change the projection
glLoadIdentity();
gluPerspective(45.0, ((GLfloat)800) / GLfloat(800), 1.0, 200.0);  //3D Mode
glMatrixMode(GL_MODELVIEW);  //Back to modeling
glLoadIdentity();

Properties that I am using for the textures:

Code :
glTexEnvf(GL_TEXTURE_ENV, GL_TEXTURE_ENV_MODE, GL_MODULATE);
glTexParameteri(GL_TEXTURE_2D, GL_TEXTURE_WRAP_S, GL_REPEAT);
glTexParameteri(GL_TEXTURE_2D, GL_TEXTURE_WRAP_T, GL_REPEAT);
glTexParameteri(GL_TEXTURE_2D, GL_TEXTURE_MIN_FILTER, GL_NEAREST_MIPMAP_LINEAR);
glTexParameteri(GL_TEXTURE_2D, GL_TEXTURE_MAG_FILTER, GL_LINEAR);
gluBuild2DMipmaps(GL_TEXTURE_2D, GL_RGB, TextureList[i]->getSizeX(), TextureList[i]->getSizeY(), GL_RGB, GL_UNSIGNED_BYTE, TextureList[i]->getData());

The problem is that I can't get the white "box" around the gun to blend with the tiles in the background. Here is a photo:

img607.imageshack.us/img607/51/ogly.png

I opened the image (.bmp) in Photoshop and deleted the pixels around the gun, but it still draws the whole rectangular image. It colors the pixels that I deleted with the last color that I used in glColor3f(), and I can get the whole image to become transparent, but I only want the pixels that I deleted in Photoshop to be fully transparent. I'm using glBlend too. From what I researched, it has to do with alpha channeling with the image, but I have no idea how. Can anyone help?