An adjusment layer is a layer is a non destructive layer that can manipulate the pixel colors of ALL layers below it, that remains editable.

Sounds complicated, but I like to think of an adjustment layer as putting on a pair of glasses. Different pairs of glasses can do different things. One pair could make everything look more red. Another pair could make everything black and white. While you SEE everything in black and white, you know the world is really still in color.

Say you had a picture and you wanted to manipulate the colors. You could go to: Image>Adjustment>Hue/Saturation.

This would allow you to lighten or darken the image, or even tint the color. However, once you were done and hit OK, you are stuck with the changes. There is no way to edit your decisions. The equivalent in our above glasses example would be to magically manipulate the actual color of the world.

If you clicked the create new Fill or Adjustment layer button, it will give you a list of all the options available:

Now you can make any changes you want to your image (darken it, lighten it, or even colorize it) the same way we did above.

Once you hit OK, a new layer appear above your other layers called Hue/Saturation. This is the digital equivalent of your glasses.

You can see all the changes you made to your image, BUT the main difference is all your original data remains untouched. You just see it differently.

The best thing about an adjustment layer is if you decide you don't like the changes you have made, you can always just double click on the adjustment layer and brings up the original dialogue box with all of the setting you made. You can then update any changes you want, and click OK again. This would be the equivalent of changing glasses.

An important thing to remember is that adjustment layers only affect layers BELOW them. Layers on top will remain untouched.

Layers also come with their own Masks already built in. The mask is like cutting a small hole out of your glasses, so that some areas remain untouched by your adjustment layer, but other areas are changed

The next layer is our Hue/Saturation layer. I set it up to Colorize everything below it Green. However, the adjustment layer contains a mask (it's the black and white box to the left of the Hue/Saturation text in the layers Palette).

This means that the Saturation layer is only affecting half of the next layer.

The next layer down is a layer of Red. We can see ALL of the red layer, however our 'Glasses' are making half of it look green to us.

The next layer down is Blue, but we can't see any of it, because the Red layer above is covering it all.

Say I want to us an adjustment layer to darken the middle layer, but not the right layer. Normally you would just move the right layer up in the layers palette and it would work fine. BUT say we couldn't move the right layers order.