Nothing is wrong with the QB. I suspect the file size of your picture is way too big. You need to size the file so it isn't so large. You can follow the directions for resizing here:
http://www.quiltingboard.com/qb-help...g-t166655.html
I have found it easier to simply resize the output on my camera so the file size does not exceed the maximum file size allowed and the pixel count is no larger than 640 x 480
If you attempt to upload a pic that the file size is too big it simply won't upload. It doesn't give you an error message.