I start with a really good scan of a paper, cardstock and I have even done with fabric also for a totally different look, that has been creased and folded and then laid flat.  I like to do several on one sheet and the corners also.  I will scan at a very high resolution like 600 ppi.  Why? Because I like to create large and save to a standard size after for highest quality.  This is especially useful when you have a limited size scanner and want a 12" crease across your paper or a diagonal one which is longer.  

Tip:  Paper bags work very well for this! Also the thicker your paper you scan, the deeper the creasing will look.  

If you don't want to scan right now, you can use a solid colored creased paper in your stash for the lesson for now. 

Open your scanned paper.

Desaturate.  Image>Adjustments>Desaturate  (Shift+Cmd/Cntl+U)

I also will sometimes play with Levels to get a good contrast that will blend very nicely later.

Make sure you try different papers, textures and materials.  Once you do one, you will see how easy these are to create.

Here is a partial of a sheet scanned in.  I am wanting the crease across the section and also will extract the crease across the bottom left corner.

We are going to grab Lasso Tool (L).

In the tool options box in the top menu, set your feather to 20 pixels. This makes it easier for blending when you use it later.

Start close to the outside of the crease and click as you go to create an outline around the section.  I seem to always start off my art board to the left and work clockwise click as I go so I don't have too straight of lines.  

When you get near where you started you will see a small circle appear near your mouse pointer.  Click now to close your selection.

Here is what mine looks like with it selected.

Now copy from the layer.  Cmd/Cntl J

Now you can either drag to a new file, trim and save to a png file OR

Turn off your background layer, trim and Save As.  Undo back to when you have your original file and do your next crease.

To use your new crease on a paper:

Open a paper, place the crease on the layer above and change the blending mode of the crease layer.  Play with the different blending modes, but I prefer soft light and duplicate some times to get a more defined crease.  It will all depend on the paper you are blending this in to.

Here's a paper from my Tween Years kit I applied my crease to.  

These are using the Overlay blending and I also decreased my fill to about 60% opacity on the crease layer. Same crease used, just one is rotated off the corner. Looks pretty darn real to me!

To use on an element:

Do as the same as you would for a paper, but clip it to your element layer.  

Arrange as you would like and play with the blending mode of the layer.

Here I've done it on one of my Flutters from my latest kit Altered Art - Flutters.

I added a drop shadow and warped it and now my flat butterfly looks like it's been folded up slightly.

For this particular element, I used Soft Light blending mode and duplicated for a darker deeper crease.

Hope you enjoyed your little mini tutorial today and watch for more distressing ideas to come.