There are two main ways to create transitions in Premiere, using the opacity rubberbands or the transitions supplied by Premiere in conjunction with the transition track and video tracks 1a/1b. I believe the rubberbands provide a lot more flexibility, but the pre-made transitions can do very neat things that rubberbands can't do. I suggest going to Help - Content - Search, and typing in "opacity rubberbands" or "creating transitions". There, you can find instructions for using the rubberbands or making use of the other transitions. Here's a small example of rubberbands at work:
