How to Change transparency of button image in Unity 5.0?

Select your Canvas (or a child object of it if you like), in the inspector click Add Component > Layout > Canvas Group.

The Canvas Group component has an alpha property (1 is completely opaque, 0 is completely transparent), which affects this object and any children of it.

In your script, you can store the Canvas Group as a variable with something like this:

 CanvasGroup yourNameHere = GetComponent<CanvasGroup>();     //(assuming the script is attached to the same game object as the Canvas Group)
 
 yourNameHere.alpha = 0;

Edit: If you want to fade it out, you can make this Coroutine and call it whenever you need:

 IEnumerator Fade (){
     while(yourNameHere.alpha > 0){                   //use "< 1" when fading in
        yourNameHere.alpha -= Time.deltaTime/1;    //fades out over 1 second. change to += to fade in    
        yield return null;
     }
  }

You don't need to add a Canvas Group component to change the alpha of a single image, Canvas Group changes the alpha of the game object with the component and any child on it.

If you have an UI Image you can change the alpha of it by changing the alpha component of the color of that Image.

Just write a script to store a reference of the Image of the UI Button, then in the script change the alpha. Something like this:

 public Image ButtonBackground;
 
 public SetTransparency(float transparency) { //transparency is a value in the [0,1] range
     Color color = ButtonBackground.color;
     color.a = transparency;
     ButtonBackground.color = color;
 }

You can create an extension, so that you can use anywhere on your code:

 public static class Extensions
 {
      public static void SetTransparency(this UnityEngine.UI.Image p_image, float p_transparency)
      {
          if (p_image != null)
          {
              UnityEngine.Color __alpha = p_image.color;
              __alpha.a = p_transparency;
              p_image.color = __alpha;
          }
      }
  }
 

Then you can just call this from anywhere:

 button.GetComponent<Image>().SetTransparency(float value);