Detailed example:

Say we have an image at:
http://xs62.xs.to/pics/06010/_avliv02.jpg
And the representative icon would be:
http://xs62.xs.to/pics/06010/_avliv02.jpg.xs.jpg

The key fact here is that the xs.to service allows hotlinking - that is direct display of an image in a remote context.

the code to display an icon linking to the image would then be:

[#URL=http://xs62.xs.to/pics/06010/_avliv02.jpg][#IMG]http://xs62.xs.to/pics/06010/_avliv02.jpg.xs.jpg[#/IMG][#/URL]

Of course the #'s are there just for visibility of the code. I will now rewrite the above stuff with all #'s ommited:

[Linked Image from xs62.xs.to]
There it is.

NOTE:
some image server will provide database access to the pictures - usually they will also show the picture codes to use in order to embed or hotlink.

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