Starting from yoursite.com/admin, scroll to the bottom and click FileBrowser.
Click the Upload button in the top right corner.
Drag your image files on the white popup or you can select your files from your image library/desktop.
Congratulations, now your file(s) will appear in the FileBrowser.
You can now insert it into a page, sidebar, or footer. Also, several versions of various sizes (including thumbnail) are automatically generated upon upload. See the figure under FileBrowser Navigation to learn where to find these versions.
The FileBrowser provides other features in addition to uploading files. See FileBrowser Features for details.