Click the Messenger menu and select "My Display Image."

Select "Share my picture" and click Select….

Browse your hard drive for a picture. The picture must be a .bmp, .jpeg, .png, or .gif.

When you’ve found it, click OK at the bottom of the window.

Change your picture anytime by repeating this process. Or you can also switch during a conversation right in the conversation window by clicking the bar along the bottom of your image, then clicking Choose a Picture.