RE:
www.joomlapolis.com/forum/usage/245329-problem-with-uploading-images
I know this post is a long time ago, but if I came across this to solve this problem then others might come across this too,
(Gd driver not installed)
To solve:
1 - Open your PHP.INI file
2 - Find (extension=gd)
3 - Delete the (
at the beginning to remove it from the comment.
This should solve the problem.
Thanks
