Is there a way to have particles spawn only within the alpha of a referenced texture?

Morning, from What I can see in your screen.
You’re setting the Position of the particle with a Shape Box that have a size of (1,0,1).
This means that your particles are on the ZX plane and will spawn between -0.5<>0.5.
So to use the particle position as UVs to sample your texture. First, be sure to use the X and Z component of your particle position. And also, you might need to “Offset” the sampling position so that it’s between 0-1.
In your case, adding 0.5 to the sample position should do the trick.

Here are some screenshots, that I hope will help you. It’s a basic example close to yours, with particles spawn on the ZX planes and the particle Position used to sample a Map to drive the Color.

9275361--1299006--upload_2023-9-6_9-31-32.jpg

9275361--1299009--Unity_cxFxokPVlT_0000-0048_750x240.gif

I hope this help you understand what I think is happening on your hand.
Have a great day.