Assume an original page like this one:

Begin by entering a title for the image (this will also be displayed as a "hover text" when the image is displayed. Then press the Browse button ...

Select the file to upload (you may have to navigate your files first). Double click on the file name, or single click followed by pressing the Open button ...

Images will be automatically resized if the width or height is more than 300 pixels. If you want to change this default action, click on the Show advanced options link and select from the Resize the image to a maximum size of: pulldown menu. In this case the Original size option has been selected ...

Finally, press the Insert Image button at the bottom. At this point the file you have selected will be copied onto the web site. If the image is particularly large this may take a long time.
When complete you will be returned to the original page with the new image attached to the left of paragraph 1:

See the tutorial Working With Inline Images for more information about moving, placing and sizing inline images once they have been loaded.