So for this tutorial, we wont get too advanced, its very simple. The things you will need is layer effects (only inner glow) and a rough edges brush set (you can use your own or download the one linked).
http://www.brusheezy.com/Brushes/1381-Rough-Edges

Step 1
Find a Wood Texture or Stock Photo.
(Mine is from http://beyond-oddities.deviantart.com/a ... -771378221)

Step 2
Add Text with a brownish color.



Step 3
Alpha to Selection on your Text, then Select>Grow by 20 px. Then add a new layer. Go to that layer (while still on the selection) and fill with a dark/medium grey. (Then set it under the Text layer)



Step 4
Gaussian Blur the Grey by 5



Step 5
Filters>Distorts>Wind
Use wind with these settings. Then go back to wind, change the direction and apply it.



Step 6
Gaussian Blur again.



Step 7
Duplicate the grey and set both modes to overlay and merge them down to the background.



Step 8
Apply Inner Glow to your text layer



Step 9
Set the inner glow to multiply and merge down to the text layer



Step 10
Add a layer mask (white) and use your rough edge brushes to paint the edges of your text.



When you're done brushing the edges it should look something like this. (You can then apply layer mask)



Step 11
Duplicate the text. Set the bottom to Multiply and set the top to Overlay.



Step 12
Flatten Image! You're Done!

Cool effect.
This would be great for making brands.

Thanks for sharing it.

Six years later... Creating an account just to say thank you! Great post, still works.