Scale a Layer smaller in Photoshop

Question

Here is an example of my problem (the real image is more difficult, but the problem is the same):

I have a photoshop file with 2 layers. One layer is the background color. This layer has the right size for the screen. The second layer is a cool art. This layer is much larger.

I do not want to copy the one layer into the other. How do I scale the second layer, not the image, so that the proportions are untouched but the layer itself is smaller and therefore fits into the first layer?

(Photoshop Extended CS 5)

Answer 1

If you want the proportions to be same , you can use.

Convert it into smart object. Right click on the layer of the object and select the option for Smart Object.

1. Free Transform (Ctrl+T in Windows)
2. Resize from the corner with shift and Alt keys pressed together.

This is what i do mostly.