Photographing fireworks sounds easy when you read about it in the photo books, but it's actually quite a challenge! There are basically two methods for in-camera shots: 1) Just crank up the ISO a bit and shoot individual bursts at their peaks or 2) use the bulb setting on your shutter speed dial (in Manual mode) and leave the shutter open for as long as necessasry to catch all of the bursts you can on one frame. The third option is, of course, is to use the first technique for shooting and then use Photoshop to collage several shots together, which is what I've done here.
To create this shot I used a 70-300mm Nikkor zoom on my Nikon D70s and set the IS0 to 800. I then photographed a series of individual frames of fireworks explosions. Once I downloaded the images into Photoshop CS2, I chose one frame (the large explosion featured in the center) and made that the background layer. I then dragged several other frames onto the background layer (using the move tool) which automatically creates a new layer for each frame. I then used the "scale" tool (Edit>Transform>Scale) to scale the other shots down to size and used the Move tool to position each burst. In some cases you could see the "black corners" of the frames overlapping on the layer beneath, so I used the move tool a lot for positioning and then used the Clone tool where necessary to copy a portion of one bust onto another to hide the dark corners. (The problem I was having was that dark corners of one frame would be laid over the fireworks of the frames below, so careful positioning and sizing was important.) During a final pass I flattened the image and then used the Hue/Saturation tool to zap the colors a bit. Hint: if you save a layered file of an image like this (in addition to the flattened version) you can always go back later and "move" each individual element or alter color/hue/saturation.
In reality this collage was very simple to create once I figured out that the Scale tool was the simplest way to size and position the bursts. It's harder to describe the technique than it is to do it. Write to me if you have any questions. I posted the image on Flickr and got 50+ views in a few hours and someone on NowPublic requested use of the image with a news story (which, of course, I granted).
In the next few days I'll post an example of using the other technique, of keeping the shutter open to capture several bursts--it's quite a challenge but I've got some tips that will make it go much more smoothly.