Create a transparency knockout group
In a transparency knockout
group, the elements of a group do not show through each other.

Group with Knockout Group option deselected (left) compared to
selected (right)
- In
the Layers panel, target the group or layer you want to turn into
a knockout group.
- In
the Transparency panel, select Knockout Group. If this option isn’t
visible, select Show Options from the panel menu.
Selecting
the Knockout Group option cycles it through three states: on (check mark),
off (no mark), and neutral (square with a line through it). Use
the neutral option when you want to group artwork without interfering
with the knockout behavior determined by the enclosing layer or
group. Use the off option when you want to ensure that a layer or
a group of transparent objects will never knock each other out.