Stencils

 
4.  Enable GLSL settings
  • Enable Shaders
     
  • Enable Shadows
     
  • Enable Lights
     
  • Enable Environment Lighting
     
  • Enable Ramps
     
  • Enable Nodes
     
  • Enable Extra Textures
Note:
  • GLSL settings appear only when the Render Engine: Blender Game is selected. 
5.  Add a Plane 
  • 3D View menu >> Add >> Mesh >> Plane
Note:
  • For this tutorial, I'm using a Plane
6.  Add a UV Texture Layer

  • Properties menu >> Object Data button

  • UV Texture tab >> + button

Note:

  • The Stencil has to be UV Mapped to the game object

  • The UV Texture Layer holds the position of the stencil on the game object.