Displaceme modificiation

Dear All,
I would like to make a picture like that made in this post.
http://blenderartists.org/forum/showthread.php?t=121223

I have some doubts… Could you help me?
I have an immage with a different colors in function of the z height. I use these setting but the picture I obtain don’t show any z height.
thanks for any help!!!

Attachments