1. Make a new layer, select Ellpitical Marquee Tool , hold down the Shift key ( Mac : Option key) and draw a cirlce.
2. Select the Gradient Tool , set it to radial gradient and make sure your foreground color is white and background is black . Drag the gradient as illustrated.
3. Create a new layer, name it " Button Shade ".Draw a smaller circle. Use the same radial gradient tool, and drag another gradient, this time in the opposite direction.
4. With your " Button Shade " layer still active go to Selection>Contract and enter 2px for the value, click OK.
5. Make a new layer, name it " Inside Button ". Use same radial gradient tool to draw yet another gradient as in step 2.
6. Make a new layer above all your other layers, name your layer " Color ". Press Ctrl+Click ( Mac : Command+Click) on your " Inside Button " layer. Fill the selection with any color you like and set the layer mode to Color .
7. If you want you may also type some text for you botton, I typed " ok ".
8. Now we need to make a Layer Set . First, Link all your layers together. Now press on the little arrow just above your layers and select " New layer set from linked ". Name this layer set " Button Off "
9. Right click on your layer set and choose " Duplicate Layer Set ", Name the new layer set " Button On ". Now we need to make an illusion of a button being pressed down.
Select " Inside Button " layer and using your arrow keys move it down 1px and 1px to the right. Also do the same to your text layer if you have one.
10. With your " Inside Button " layer still selected go to Layer>Layer Style>Inner Shadow... leave the values default and press OK. You're done! Check out the effect when the button is pressed.