To use the Extract tool, the user provides information to Photoshop through highlighting the areas that should be extracted. The highlighting acts as a hint to Photoshop, letting it know what the user wants to extract. Based on the hints, Photoshop guesses the desired result, and extracts what it thinks the user is telling it to keep. The user can make the task of guessing easier and the results better by being more exacting in the hints that are provided for Photoshop.
To provide the hints, the user will break the image up into three parts: the part that should definitely be kept, the part that is unwanted and the 'decision' area. This decision area is defined by highlighting in either case. The part that should be kept is defined in two ways depending on whether the extraction will be based on color or shape. Users should make a color based extraction when color is more important than shape; users should make a shape based extraction when the shape may contain multiple colors.
Color Based Extractions
For color based extraction, the essential tools are the Edge Highlighter (B), Eyedropper (I) and Force Foreground checkbox. Force Foreground, when checked, dictates that the decision for the extraction will be based on color. The Edge Highlighter is used to cover and highlight the area from which selected color will be extracted. The Eyedropper is used to select a color which will be used for the basis of extraction within the highlighted area only. This color becomes the part of the extraction the user definitely wants to keep. The area that will not be included at all in the extraction is not highlighted.
Shape Based Extractions
For area or shape-based extraction, the essential tools are Edge Highlighter (B), and Fill (G). The Force Foreground check box will be unchecked, indicating that the decision area will be based on shape. Shape based extraction is accomplished by first highlighting the edge of what the user wants to keep using the Edge Highlighter (this becomes the decision area). Once the edge, or outline of the shape, is completed, the area to keep is defined using the Fill tool. The area that the user does not want in the extraction should not be highlighted or filled.
Highlighting is affected by the Edge Highlighter (B) and Eraser (E) tools, and by the brush size chosen for those tools. Use the Edge Highlighter to define or highlight the area to be considered (for color based extractions) or the edge of the object (for shape based extractions), and the Eraser to refine the highlighting or erase mistakes.
The more clearly the user defines the parts of the image that should be extracted and the smaller the decision making area, the better the final result will be. Once the highlighting is complete, the user can preview the extraction, and touch up the results before accepting the changes and completing the extraction. The Clean Up (C) and Edge Touch Up (T) tools become available when the extraction is previewed so that the user can improve the temporary mask that is created. The Preview button becomes available when there is highlighting and a selected color (in the case of color based extractions) or highlighting and fill (in the case of shape based extractions).
To help you out
Seeing, in this case, may help in the understanding how to use the tool. To this end, I have provided movie segments for the tutorial which show the tool in action. Hopefully you can get the idea from the text and screenshots, but downloading the movies as well can help you see exactly what to do. The downloads are a bit large, and they are not terribly long, but are full-size renderings showing tool activity.