A transparent image (PNG 24 with transparency, Gif with transparency), in a PictureBox on a Form is going to show the Form's BackgroundColor in its transparent areas, and, if placed over other controls, like a TextBox, for example, the areas in your Image you may think are "transparent" will cover the other controls with the Form BackGroundColor.
The only way the transparent areas in the image will show what is "behind the Form" is if you have set a Transparency Key property for the Form itself with the same Color as the BackGround Color you have set for the PictureBox.
WinForms does not really support "true transparency" in the way WPF does, for example. There are lots of articles on the web showing various tricks to get different types of transparency into WinForms, ranging from using Custom Paint Events to using Panels with certain SetStyle options set. There are exotic solutions using transparent Form overlays, and special Windows API calls.
Check out, here on CP: [
^].
imho, you are generally wasting time to try and get sophisticated transparency effects in WinForms.