Quick and dirty way: create a polygon for the complement of the region to be shown (by subtracting the region from a large rectangle, for instance). Draw this polygon over the raster.

Better: the states should be polygons. Convert the state layer to a raster. Use that as a mask to clip the image. For a tutorial, see Better Raster Clipping Options in ArcGIS.

BTW, the image cannot be "displayed in shapefiles" because shapefiles (a) do not store images and (b) do not store graphical information. They store only the coordinates for representing vector features.

Quick and dirty way: create a polygon for the complement of the region to be shown (by subtracting the region from a large rectangle, for instance). Draw this polygon over the raster.

Better: the states should be polygons. Convert the state layer to a raster. Use that as a mask to clip the image. For a tutorial, see Better Raster Clipping Options in ArcGIS.

BTW, the image cannot be "displayed in shapefiles" because shapefiles (a) do not store images and (b) do not store graphical information. They store only the coordinates for representing vector features (along with the attributes, of course).