Help me pleeeeease!

I've seen people put actual pictures into their stories, like not just a link. I've been trying and trying but I really have no idea what I'm doing when it comes to encoding and all that jazz. Anyway -
I'm just wondering if anyone could enlighten me on what I need to do? If I can do it at all, that is; I know on some sites you need to be a VIP or paying customer to do certain things, and I'm not sure if it's the same here.
(Any cool ways to fancy up my layouts is appreciated too!)