Yes. You can do that.
#edit{
width:200px;
height:200px;
overflow:visible;
margin:200px 0 0 200px;
background:gray;
position : relative;
}
#containment{
width:500px;
height:500px;
opacity:0.5;
background:red;
position : absolute;
top : -150px;
left : -150px;
}
Demo: http://jsfiddle.net/fzAge/2/