Use the lasso tool to draw round the selected area
(Optional but recommended: Right-click and select 'Feather'. This will enable you to get rid of the harsh edge around the selection. The appropriate number of pixels depends on the size of the selected area. If it's very small, try '3'. Otherwise try '5' or '10'.)
(If you want to blur the area outside the selected area, instead of the selection itself, right-click and choose 'Select inverse')
Go to Filter > Blur > Motion Blur. Choose a suitable number of pixels. (More pixels = more blur). If required, choose a suitable angle for the blur effect. Click 'OK'
Right-click and 'Deselect'
Chris