Go to www.imageshack.us
and upload the image to be hosted there, get the link, and then come back here and click on the box that looks like a painting and insert the code link in between the tags and that's it! (Imageshack allows you to resize the image.) You can also upload to photobucket, or any other image hosting site. They're all basically the same.
Or you can directly upload it here to be hosted through permuted press by clicking on the "additional options" (orange letters on the bottom left, and it will allow you to browse pics in your folder to be uploaded directly.