HiCustomer
Well you need to follow the steps below:-

1>Visit the link below:-
CLICK LINK!

Or the link below:-
CLICK LINK!

2>upload your picture to either of these free image hosting sites (photobucket, imageshack.us)

3>It will give you an URL.
E.g:
http://imageshack.us/123image.gif --- is the url of my image uploaded to imageshack.us.

4>Aand then use that url with the img tag while posting to craigslist

When i post my article to craigslist i use the img tag as follows
<img src="http://imageshack.us/123image.gif" alt=image" title="image"

Hope this helps.

If you find my answer useful, please press the Accept button and give me a positive feedback. Bonuses are appreciated. If you need any further help just contact me!!

I have a different picture of what's going on, so I'd like to offer my Answer to this:

Since you are uploading image(s) to craigslist website, I presume you are posting an ad, on that website, in which you wish to include (or which you want to be made up of) image file or files.
Craigslist terms may or may not prohibit some things, or uploading images in some categories, but if you were posting an ad in e.g. computers area, you would
a. Click on the Post link at the upper right of the category's screen
b. Select a category (which must be specified even if you came from e.g. the computers category area
c. Select an area (at least in the washingtondc craigslist, which is what I use, and which serves 3 'state' areas
d. Get a form with the entries for Posting Title: and Price: and Posting Description: ....etc. ready to be filled out. Below the big empty box for Posting Description:, scrolling down, you would find
e. ...A button titled Add / Edit Images .... click once on that button and, scrolling down the page again, you will get 4 big red X s and four Add: entries with Browse buttons to their right.
f. Click on one of the Browse buttons, for instance the upper left one.
g. You will get a File Upload window, which shows your own computer's file areas.
h. Use normal methods to go to the folder that contains the image you want to put on craigs list in your ad (e.g. click on My Computer to the left, then on C: Hard Drive, then on folder names in the path until your image file shows up.
( Note: you mentioned Albums.... you cannot publish Album files on craigslist, I'm pretty sure. Only image files: JPG, JPEG, GIF, or BMP most likely. But I'm not quoting craigs list rules on that, just my common sense.)
i. Double-click on your image file, in the File Upload window (or click once on it to select it, then click the Open button... in either case the File Upload window disappears and you ought to have a green circle in place of the red X, next to the Add: entry (now filled) and the Browse button you clicked.)
j. Add the other 3 images similarly, by repeating steps f., g., h., and i. (if you have up to 3 more images to put in the ad), then fill in entries for the ad above and click the Continue button at the bottom.... and continue with the process of getting your ad posted.

(If this is a workable answer to your question, by all means click Accept for it, to let me and the system know that it worked for you OK. If not, reply letting me know what went wrong in some details. Thanks.)