How to Upload Pictures/Photos in Blogger

First, make sure the picture that you want to upload is compressed, so the file is not too big.

You can also crop it or edit it in MS Picture Manager.
Sign in to blogger as usual.
Start a New Post (or edit an old one).
Click on the tiny picture of a picture above the text box where you usually write your post .
In the new window that appears, click on "Browse", and find the file where the picture you want is saved.
When you have chosen your picture, click on the blue "upload image" button.
Wait for your picture to be uploaded, then click "Done"
Remember to click on the orange "Publish Post" when you have finished uploading your picture and typing your entry