Credit : http://www/photoeditinglab.com Let's talk about clipping path and have see and example.

1. Clipping Paths
Clipping paths are necessary in Photoshop when you
want to create a “Drop-out”, especially on a colored
background. In the example of the flower (right) you
can see how the green foliage has been “dropped
out” of the photograph, so that all you see is the
yellow color of the background.
The same is true in the example of the fly, (below)
even though the original image of the fly doesn’t seem
to have much of a background at all.
Clipping paths are similar to strokes in Adobe
Illustrator. If you know how to manipulate strokes you
should have little difficulty with clipping paths.
Select Window, Palettes, Show Paths to get the paths
menu. Once you have the menu you can either create
paths by hand or you can use one of the selection
tools to create a selection and then convert that selec-
tion to a clipping path.
Your final file has to be in cmyk, have no extra layers
and channels and you must save it as an EPS file.
I will demonstrate this procedure in class. Please follow
along and then practice on 4 or 6 more photographs.