Please Note: The WordPress Image Uploader was upgraded dramatically with WordPress 3.5. See updated instructions for using the WordPress 3.5+ image uploader.
Add title and text as shown in the Create Posts tutorial on this site.
Before you insert the image into your post choose the size and alignment.
Alignment: None will place an image on its own line with text above and/or below.
Alignment: Left will float the image to the left with text wrapping around the right.
I never use Alignment: Center.
Alignment: Right will float the image to the right with text wrapping to the left.
Usually I use Alignment: None for images that are as wide as the content section of the page.
And I use Alignment: Left with Medium size images for magazine style articles.
Repeat until satisfied.
Click Publish or Update to save the entry.