Personally I find this hard to do, because with targa extensions, alpha layers and blp conversions, there's just so many things to do wrong.
In a nutshell, you select the Alpha layer in Photoshop, and fully paint over the section you want removed within that layer. The alpha layer is found under RGB, Red, Green, and Blue. In the alpha layer, the paint you use will appear as a transparent red.
Howeverrr, this only works if you've exported the .blp as a 32-bit targa file.
And THEN, it only works if you have downloaded and installed the targa plugin for Photoshop.
And on TOP of that, you have to be lucky the model doesnt read the skin wrongly, and produces a model consisting out of only the team colors. (something that happens to me very often, causing great annoyance)
And even MOREso ontop of that, you have to be lucky that the alpha layer alteration isn't interpretated as a Team Color, but as a Full Removal, otherwise you'll get a fully BLACK model with team colors!
*pant*
Oh, and there's those tutorials that might help. they have links to the targa plugin thing I think.
