Open a New Document at 600x600 ( File > New )
Create a new Layer.
Set the Foreground colour to #AAAAAA
Grab the Rounded Rectangle Tool. ( May be hidden under Rectangle Tool )
Set the radius ( At the top ) to 25 px.
Make something big but not too big. CTRL+Click on this shape's layer and go to Select > Modify > Contract
Put in 20 px and click OK. Now, press CTRL+X to delete the selection.
This is what I have so far:
Click HereGo to that layers Blending Options and copy these settings:
Drop ShadowOuter GlowInner GlowBevel & EmbossContourSatinColour OverlayStrokeFINAL RESULT