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First create your Text Box and fill it with your desired text. Make sure the text box is big enough to fit both your Text and Image. Open up the Text Wrap Window by pressing Alt+Ctrl+W or go under the Window Tab -> Text Wrap. Insert your picture via File->Place or simply Copy and Paste. Adjust the size of your image and place it within your text box. Click the Wrap Around Bounding Box option. Use the Offset adjustments to create distance between your text and your picture. The Jump Object box will create a gap between your text where your image is. The Warp Around Object Shape box is used for images that are not square or rectangular.
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