how do I make the photos fade from one to another?

A fade (also called a crossfade) is a transition that is applied between two photos. 

If you want a single transition just between two photos (or videos), you always select the second photo (or video).  Now go to the Animations tab.  You'll see a bunch of icons on the Animation "ribbon".  If you use the down arrow to the bottom right of the icons, you'll see more of the available transitions.

The one you want to find is under Dissolves and is called a Crossfade.  The icon looks like the one highlighted below:

You can apply that just at the point you have selected, or to all photos in the storyboard, by selecting the Apply to all button.

You would need to click on Animations. All of the 6 "buttons" on the top can do everything I Movie Maker. It's nice that there isn't more.

You can fade into white or fade into black. You can click on the video that you have open and go to Animations and when you click on one of the choices you will see it occur on the Movie Maker screen.

HG

First time at this. How do I fade from one photo to the next?

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Have you tried using a transition?

Tutorial . Basic Editing - Windows Live Movie Maker

http://www.eurobricks.com/forum/index.php?showtopic=74403

(see the section  : Adding Animations & Visual Effects)