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I had this problem once before and its NOT a xcgallery problem. Its a permission problem.
You need to make sure that both albums and userpics are chmod to 777 same as in the aministration>xcgallery>preferences section it needs to be written 0777.
You may find that your ftp client will not let you change these permissions as it did to me it kept going back to 755, so you will need to change the permissions via your cpanel that your hosting provider gave you. If all else fails I would start asking your hosting provider why you cannot set the right permissions.
The album and userpics NEED to be writable so the script can add picture and create directories in there if its not writable then it cannot do this and you will end up with errors like yours.
hope this helps
kiwiguy
