If you have the picture hosted elsewhere, like I do on my own domain, it will end up looking like this:

If you have it uploaded to photobucket, use the photobucket tags instead of the "img" tags.
Or if the picture is ONLY on your computer and you have no place to upload it, you can "attach" it to your post using the "upload attachment" function below the editing window. I'm going to use that to attach a couple of screenshots I just took using the wonderful tool SnagIt.