With the standard package you order from Constant Contact, you can only have up to 5 images in the Image Library unless you pay extra to have more storage.  So, what you can do is instead upload an image by URL and not use any of space from your Image Library.  Meaning, you can upload a photo you want to use in your newsletter to an online photo album like Photobucket (www.photobucket.com) or your Typepad File Manager (if you use Typepad).  You can even use images already on your blog!

Here's how you do it!

Uploading and Storing Your Image Online

If using Typepad

To upload an image to your File Manager:

1. Login.
2. Go to the Control Panel.
3. Click on Files.
4. Click the Browse button. Choose the image from your computer and then click Upload.
5. Now you will see it added to your list of files on the left.
6. Right-click on the file name and choose Copy Shortcut or Copy Link from the shortcut menu that appears.  This copies the URL/path for the new uploaded image. For example, something like https://blogsbyheather.com/wp-content/uploads/2009/04/blogsbyheathersignature-4.gif.
7. Once the image is uploaded and you have the URL/path, you can log out of Typepad.

If using Photobucket (free):

1. Create a free account or login.
2. Towards of the middle of the screen under Upload Images & Videos, click Choose Files.  This allows you to select image from your computer to upload.  Select the images and click the Open button. Then you will see the files being uploaded.  They will appear in the album when the window refreshes.
3. Put your mouse over an image and a shortcut menu appears with Direct Link as one of the options. Choose it and Copy it – such as http://i493.photobucket.com/albums/rr300/blogsbyheather/BlogsByHeather.jpg.
4. You can now logout of Photobucket.

If using an image that already exists on your blog:

1. Go to your blog.
2. Right-click on the desired image and choose Properties from the shortcut menu that appears.
3. Select and copy the Address (URL), such as https://blogsbyheather.com/wp-content/uploads/2009/04/HandStampedByHeather.jpg.

Now you are ready to go to Constant Contact:

1. Login.
2. Create a new Email or Edit an existing one.
3. Go to the area of the newsletter where you would like to insert an image. This is done through editing one the "blocks." Click the first icon above the "block" you want to edit - it looks like a pencil in a square (that’s the Edit Block button).
4. If the section template already has an image placeholder or an existing image, right-click on it and select “Change Image” or if you need to insert a new image, from the left sidebar, click the Insert Image icon.
5. When you get to the Select Image window, click on the 2nd tab “Enter Image URL” then in the first text box “Image URL”, paste in the path you copied from above, such as https://blogsbyheather.com/wp-content/uploads/2009/04/blogsbyheathersignature-4.gif). Then you can click Preview to see it. 
6. Then in the “Description” you can leave it blank or enter a description like.
7. Then in the last text box “Make Image a Clickable Link To”, enter where you want the visitor to be directed if they click on the picture or you can leave this blank as well.  For example, if you are inserting a picture of a promo image, then enter the PDF from the SU website or other link about the promotion!  Or have them go directly to your blog, such as https://www.blogsbyheather.com.
8. Choose if you want to Float the image. Meaning, if you are inserting a promotional image, you may want to float it to the left or right.  Or leave "No" if you want it to be on a line by itself.
9. Then click the Insert Image button.
10. If the image is too large, right-click on it again and choose Resize. Choose a new size and then Insert again (new size will appear).
11. You're done!

Hope this helps!