Fades are Transitions used to indicate when one scene dissolves slowly into another rather than cutting from one scene to the next.

In the Beginning:

The Fade found in just about every screenplay is FADE IN:.

More times than not, FADE IN: is the first two words on Page 1 of a screenplay. Sometimes writers will opt to put the screenplay's title centered above FADE IN:, but since the title will be on the Title Page, most writers find putting the title on Page 1 redundant.

Also, there are times the film will start with words on the screen, and FADE IN: will be below them. But, technically we could "fade in" to the words on the screen, making it so FADE IN: can be first even in these situations.

At any rate, FADE IN: is the ONLY Transition that will be found justified to the left margin. And, in spite of what other critics may say, it shouldn't be used except the one time.

In the Middle:

Another common Fade is used between scenes so one slowly melts into the other:

Like all other Transitions, this one is found along the right margin. It also ends with a colon.

In the End:

Optionally, screenplays will end with a Fade.

Screenplay writers have some options available for how to end a screenplay. They can end with FADE OUT. right justified and ending in a period, or they can end with THE END in ALL CAPS, centered, underlined, and spaced about 4-6 spaces below the last words. Screenplays can also use FADE OUT. and THE END together, and most do.

There are other ways of doing this final Fade. Many writers will want to indicate the color to which the final scene fades before the credits start rolling.

Here is how it is done:

Of course, writers can fade the end of the film into any color, but don't do so on a whim. Have a reason to do it.

By the way, these are the ONLY Transitions that end with a period.