C#

protected override void WndProc(ref Message m)
{
   base.WndProc(ref m);

   // WM_ERASEBKGND
   if(m.Msg == 0x0014)
   {
      Graphics newGraphics = Graphics.FromHwnd(this.Handle);
      newGraphics.FillRectangle(new SolidBrush(Color.Khaki), this.Bounds);
   }
}

public class MyToolBar : System.Windows.Forms.ToolBar
{
	private int indexButtonOnHover = -1;

	public MyToolBar()
	{
	}

	protected override void OnMouseLeave(EventArgs e)
	{
		// Reset value and repaint
		indexButtonOnHover = -1;
		this.Invalidate();
	}

	protected override void WndProc(ref Message m)
	{
		// WM_ERASEBKGND
		if(m.Msg == 0x0014)
		{
			// Create a texture brush with the current background image
			TextureBrush textureBrush = new TextureBrush(this.BackgroundImage);

			// Paint background using the texture brush
			Graphics newGraphics = Graphics.FromHwnd(this.Handle);
			newGraphics.FillRectangle(textureBrush, this.Bounds);
			return;
		}

		// WM_LBUTTONDOWN
		else if(m.Msg == 0x0201)
		{
			// Check if left mouse button down on a button, repaint
			if(indexButtonOnHover != -1)
				this.Invalidate();
		}

		// WM_LBUTTONUP
		else if(m.Msg == 0x0202)
		{
			// Check if left mouse button released on a button, repaint
			if(indexButtonOnHover != -1)
				this.Invalidate();
		}

		// WM_MOUSEMOVE
		else if(m.Msg == 0x0200)
		{
			// Get current cursor position
			Point pointClient = this.PointToClient(Cursor.Position);

			int count;

			// Check all toolbar buttons to see which one the mouse cursor is
			// currently on and repaint the rest cos they will disappear for some reason
			for(count = 0; count < this.Buttons.Count; count ++)
			{
				// Is mouse cursor on this button?
				if(this.Buttons[count].Rectangle.Contains(pointClient) == true)
				{
					// Check to see if the mouse cursor is the first time entering
					// this button, repaint the rest of the buttons
					if(count != indexButtonOnHover)
						InvalidateNonHoveringButtons();
						
					// Store index of button that the mouse cursor is currently on and
					// break the loop
						indexButtonOnHover = count;
					break;
				}
			}

			// Check if the mouse cursor is not hovering on any of the buttons
			if(count == this.Buttons.Count)
			{
				// Check if the mouse cursor has just entered a non-button area of the toolbar,
				// repaint cos the buttons will also disappear for some reason
				if(indexButtonOnHover != -1)
					this.Invalidate();

				// Mouse cursor is not onto any button
				indexButtonOnHover = -1;
			}
		}

		// WM_PAINT
		else if(m.Msg == 0x000F)
		{	
		}

		base.WndProc(ref m);
	}

	private void InvalidateNonHoveringButtons()
	{
		// Repaint all buttons that is not being hovered
		foreach(ToolBarButton toolBarButton in this.Buttons)
			if(this.Buttons.IndexOf(toolBarButton) != indexButtonOnHover)
				this.Invalidate(toolBarButton.Rectangle);
	}
}

public class MyForm : Form
{
  // ...
  protected override void OnHandleCreated(EventArgs e)
  {
    base.OnHandleCreated(e); //
    // Put your initialization code here and add it to the Controls property
  }
}