Painting with light (PWL) was often done in the traditional darkroom by dodging and burning light as it passed from the enlarger to light-sensitive paper. There are several ways you can simulate this effect in Photoshop. For this method we'll add a transparent layer and paint with black to darken and white to lighten. This can be seen in the following example where I've painted with light for a grittier effect.
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The PWL effect is achieved using the following layers:
Both Vivid Light and Hard Mix will give good results. Hard Mix, introduced in Photoshop CS, is the strongest of the two. Both blends have the same effect on shadows, but Hard Mix will produce brighter highlights.
To paint with light choose the paint brush, set opacity to 10-20% and paint with black to darken and white to lighten. Press "D" for default colors (black & white) and "X" to swap colors. Use the "[" and "]" keys to control brush size, and the Shift-[ and Shift-] keys to control brush hardness.
To make global changes in the entire image vary the Opacity slider for the Amount group to vary the intensity or amount of the effect, and the Opacity slider in the Contrast layer to control contrast. Start with Amount set to 100% and Contrast at 50%. If you get carried away and overdo the effect then, as a last step, reduce Amount for more reasonable results.
A Paint With Light action, that uses the Hard Mix blend, included in the Actions download. If you have a version of Photoshop that does not support Hard Mix, just change it to Vivid Light. Also consider Chip Springer's Paint With Light action, at Actions Central, that achieves similar results and uses Color Burn and Color Dodge blends .