How To Insert Image Inline In Gmail Messages?

With Microsoft Outlook 2007, I can copy and paste screenshot taken by Snipping Tools into the email body. Instead of appearing as image attachments to recipients, the images are shown inline with text in the email body.
In Gmail, there is no such feature by default, to insert images inline in email body. You can, however, enable a Gmail Labs feature called “Inserting Images” to enjoy this function:

As you can see from the screenshot, sender can easily refer to the image by explicitly position the image in question right inside the email body, rather than asking recipients to refer one of the attachments.
It is more convenient to read email with images appearing inline as compare to open attachments one by one and flipping between email message and attachment views, isn’t it?
How to paste image in Gmail message body?
1) Log in to Gmail and access to Gmail Labs
2) Locate and enable the “Inserting Images” plugin appears in the Gmail Labs listing
Now, go to compose an email in Gmail, you should notice a new shortcut icon (as highlighted by irregular circle in the screenshot).Click the “insert image” icon to select the right image with pop-up dialog box and click OK button to insert / paste image into the email body.


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2012 •
Here is an easier solution
http://blog.wedran.com/2010/05/how-to-paste-screenshots-using-gmail.html
Recently Google resolved two major issues with Gmail. It is now possible to take a screenshot and paste it directly into an email message. It is also possible to use Gmail as standard email client that pops up when a user clicks on an email link on a webpage. Follow these steps: