Photo carries unwanted gray edge

Hi,
  I'm on CS3 and I know this might be simple but here it is. I did a layer Mask over a photo to brush a soft white edges around it to make a feathering effect. I know I could do feathering more directly, but the layer masking method seems to offer more control.
The only problem is when I export the photo, there is a faint gray line around its edge outlining the photo against a white web page. I've tried brushing over the edge of the photo with a white brush to get rid of the line but that had no effect on it.
I figure this is really simple and I feel like I've seen this issue in forums before, but I can't remember how to solve it.
Many Thanks for any help,
Frank B.
Here's the photo in all its glory.

Many Thanks for your help. I did try a Png-8 and got the same edge; and I did check the transparency box on the export. So I don't know what I'm doing wrong.
Btw, This edge is not technically transparent if I'm reading this correctly - it's white and painted white as well. There's a full layer of white underneath done with the paint bucket.
So I'm still lost - I put the old photo version back into the website - a feathered version which is imperfect.
It's Http://www.frankbright.com/ClaireFrazierDuo.htm
Thanks again, Frank B.

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