How can I insert an Internet image in my Outlook signature?

In Outlook 2007 navigate to the "Signatures" window. Select "Tools - Options - Mail Format - Signatures".
In Outlook 2010/2013, select "File - Options - Mail - Signatures". While editing your signature, click the "Insert Picture" icon (shown below).

Inserting an Internet image in your signature follows the same process as inserting an image from your local computer. Instead of browsing to the location on your computer, you can type the Internet address of the image in the location field.

You must click on the little down arrow on the Insert button and choose "Link to File" to maintain the link. The “Insert” option will create a local copy and the "Insert and Link" option will create a local cache of the image which only gets updated when you update your signature.

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