If you are trying to upload pictures for a post in a thread, then follow the advice above.
If you are wanting to make an album, then click into the "Pictures & Albums" link on the left of your UserCP under "Networking". Click on the particular Album to which you want to add the picture, or add a new one. Click on "Click here to upload pictures", then click on the "Browse" button. Find the picture you want to add and select it. Once you have all the pictures you want to upload, click on the "Upload Pictures" button.