If you try to drop a texture containing transparency onto an object, the material that is automatically generated is going to be incorrect. The same thing will happen if you try to create the material from the texture yourself. The reason is because you have to customize the material to understand that it is supposed to account for transparency.

Just trying to drop it in automatically will result in some nonsense like this:

The way to fix it is to open up the material and do two things:

  1. Set the Material’s Blend Mode to Translucent
  2. Link the Alpha node from the Texture Sample to the Material’s Opacity node

Here’s an example of my material after having done that:

Now your material should be accounting for transparency as expected:

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