Dynamic lighting for top down shooter?

I want to have the current room the player is in the be lit up. I also want it to fade away (the light) the farther away it is from the player.

I'm using the free version.

Thanks.

This is also something that I would like to implement. I have been experimenting but have found nothing yet to do the trick.

You mean something like one of these demos/tutorials yeah?

http://www.scirra.com/forum/deadspace-the-darkness_topic50514.html

http://www.scirra.com/forum/behavior-grid-based-sight_topic44861_page2.html

http://www.scirra.com/forum/flashlight-type-effect-on-an-image_topic53194.html

http://www.scirra.com/forum/layers-and-blend-modes_topic63076.html