Start a new message; click the 'Upload a File' button below the message. A dialog box will appear; click 'Choose File.' A drop-down box will appear that allows you to navigate to wherever the image is located on your hard drive. Select the image, then click the 'Open' button. A small pic of the image will appear below your message. Click either 'Thumbnail' or 'Full image,' depending on how you want it displayed in your post. Finish your text, click on the 'Post Reply' button. You are done.
I think it's really great that this site allows you to upload files in this way, so you don't have to post your images elsewhere online, and then link to a URL.