automation of the volume in the playlist or in the pianoroll u got the choice.
I agree with Open Mind on this... this way gives you more detailed control...
On the piano roll, change the note properties (showing note velocity by default) to channel volume... automate the fade out as desired...
Also, in FL 7, the note release is available in the note properties of the piano roll as well so you can do further tweaking...
One thing to keep in mind if you do the channel volume automation on a pattern and the end of the automation leaves the volume all the way down, and then use the same channel on a different pattern further down the play list, make sure to bring the volume back to normal or whatever level you want... or you won't hear it cuz the volume will be all the way down from the last automation (fade-out) you did...
Peace...