Observation suggests that the chromatic changes which elicit an impression of transparency include translations and convergences in color space. Neither rotations nor shears in color space lead to perceived transparency. Results of matching experiments show that equiluminous translations, which cannot be generated by episcotister or filter models, give rise to the perception of transparency. This implies that systematic luminance change is not needed for transparency to be perceived. These results were used for the development of a method for detecting a transparent overlay within a color image and for separating the overlay from the underlying surfaces. The method tests for the coherence of chromatic change along contours through X-junctions to help detect the contour of a transparent region. The algorithm tests locally for translation and convergence to detect a transparent region. It estimates globally the chromatic parameters of the transparent overlay in order to separate the overlay from the underlying surfaces.