Problem

You want to flood fill an area of an image in GIMP to be transparent. This apparently is not possible in GIMP. But it's actually quite simple to do.

Solution

Note: This might work on other platforms - I assume it does - but I only can test it under Linux so I won't claim it works on other platforms.

This seems to be to be an undocumented feature (at least at the time I originally wrote this, that being 2015-08-08T09:00:23+00:00). Why they would have this undocumented I do not know but I suppose it was an oversight.

1. Make sure there is an alpha channel:
   Click Layer -> Transparency -> Add alpha channel (if you know the image already has an alpha channel you can skip that step).
2. Select the bucket fill option.
3. Configure the bucket fill mode to be ‘Colour erase’ (if you have American English it probably will be ‘Color erase’).
4. Make sure transparency is set to 100%.
5. Execute the flood fill (called bucket fill in GIMP).

By erasing the colour you’re making the area of the image transparent.