Download a file called “icoFormat.8bi”.
 Save it to your “File Formats” folder inside the “Plug-ins” folder in Photoshop.

To re-cap, you make an icon this way:

1.      Open your source image

2.      Create a new file, and make the canvas size 32 pixels wide and 32 pixels high

3.      Select the area you wish to use from the first image, and drag across to the new 32 pixel canvas

4.      Re-size the image by using Edit-Transform-Scale

5.      Sharpen the re-sized image

6.      Convert to 256 colours by using Image-Mode-Indexed colour

7.      Use File-Save As to save the file as an icon. There will be an “ico” format in the drop-down box

8.      In PTE, open the Project Options box, and on the Main page tick the “Use your own icon”

9.      Click the “add 32x32 icon” button and browse to where to saved the file.