First, you have to upload them onto an image-hosting site like Photobucket or Picasa.
When your pic is uploaded, (I don't use either of those, so I'm going off of what I do for the pictures I upload from my own blog) right-click the photo and go to Properties. Properties will show the picture's address on the web. Copy that, and paste it here like this:
[img]http://www.mydomain.com/pics/pic01.jpg[/img]
Hit preview to make sure your picture displays correctly; if it does, hit submit.
EDIT: If you're using already published photos, BE SURE not to hotlink. Copy the picture and put it in your own image site, rather than just hotlinking to the existing picture. This eats up bandwidth and is highly discouraged.
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