git clone https://email@example.com/cwninja/justpics.git
A little while ago twitpic change their terms and conditions making it so they owned all your pictures.
People got all pissy, as people do. So I made justpics. It's a very simple image hosting site that you can host yourself, on your own hosting, using your own s3 bucket.
It can even do some basic URL shortening for you, just because.
It's fully compatible with the Twitter iPhone app, just set it as a custom image hosting service.
It's designed to cost as little as possible in S3 bills and to be easily hosted on Heroku.
Files are stored on S3 as a SHA of their contents, so all URLs are immutable, and can therefore be cached forever. This allows it to fully exploit Heroku's Varnish cache, along with ISP and local browser caches.
If you wan't to, you can even host it as a rails engine or as a middleware inside another app.
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So now you have all the tools you need to build your own image hosting application. Setup instructions are available in the README file, and the code is available on github, all published under the WTFBPPL.