Anytime content is posted to an activity wall (regardless of the type of post) a user can attach a picture file. To post a picture to the activity wall, click 'Attach a File', and select a file that is stored on your computer or a shared drive you have access to.
A successfully attached file will have a paper clip next to your attachment. You can remove the attachment by clicking on the red X. When you are finishing composing your update click "Post".