A display may have an active area in which pixels display images through a transparent display layer. An opaque masking material may be formed in an inactive border area adjacent to the active area. The opaque masking layer may include particles such as carbon black particles to provide the opaque masking layer with a dark appearance. The color of the opaque masking layer may be adjusted by incorporating additional particles such as titanium oxide particles. Particle size for the carbon black particles and the index of refraction of the opaque masking layer may be adjusted to reduce reflectance in the inactive border area. A transparent conductive layer may be supported by the transparent display layer. Index-of-refraction matching layers may be interposed between the transparent conductive layer and the transparent display layer. The opaque masking layer may be interposed between the matching layers in the inactive border area.