Hi
Have you checked to see if the folder your users are uploading avatars to is writeable?
There is information at www.php.net that covers the whole topic of uploading images, etc to web servers. The important point is that uploaded files are (very temporarily) stored in the web server's global /tmp folder. They get automatically erased from here as soon as the next http request is made, so the upload form's target has to be a non-http script (PHP in the case of XOOP). This script has to copy/move the uploaded file from /tmp to somewhere more permanent (!) before handing off to the next browsable HTML page. This more permanent resting place has to be writeable by the XOOP process, or the file copying will simply fail.