Have you had problems getting the Wordpress 2.5 / 2.6 upgrade image upload feature to work? Here’s the fix for the HTTP Error Uploading Images WordPress 2.5

FTP into your site and “edit” your .htaccess file.

Add the following to the the .htaccess file after the “END WordPress”:

<IfModule mod_security.c>
<Files async-upload.php>
SecFilterEngine Off
SecFilterScanPOST Off
</Files>
</IfModule>

If you are having the problem of your .htaccess file losing its changes, you have most likely put something inside the Wordpress block of the .htaccess file. Keep any custom changes outside of that block or they will be overwritten.”

Compliments of:
http://geek.thinkunique.org/2008/03/30/fix-wordpress-25-upload-error-http-error/

If there isn’t a .htaccess file in there just create one