Adding products to your Magento products is relatively easy.
First if you haven’t done it already bring up the list of products from the Magento Admin area > Catalog > Manage Products
Browse and upload your image:
Now, that you’ve loaded the image select the display options you want for it. Note: images will automatically scale to the appropriate size but if you want to optimize images for each here are recommended dimensions:
Small Image -> Used in category landing/product listing page, recommended size: 135px X 135px
Base Image -> Main product image in Product View page, Base Image can be whatever, though, the default is set to 265px wide.
Recommended size for thumbnail is 50 X 50px.
Click Save and Continue and your done.