My MFA thesis manuscript and now novel manuscript making its rounds was inspired by a photograph from the book Without Sanctuary: Photographs and Postcards of Lynching in America. If you go to the website, the specific photograph is #49 under the "photograph" link, but please be aware that the pictures are very powerful and disturbing. They're not for everyone.
Not to put myself on a level with Robert Olen Butler by any means, but he's been doing some really interesting work lately juxtaposing images with words, and I'm learning a lot from him. You can imagine how much I enjoyed the short stories in Had a Good Time: Stories From American Postcards.. He actually documents writing what I think is the title story for the collection on his website (linked to his name above.)
So I was really interested to run across a collection of short short stories by ROB in Narrative Magazine (you have to log in but the subscription is FREE! And it's amazing and well worth the few clicks, I promise.), called "Weegee Stories." (Red alert Cara! Red alert!) The stories and pictures posted are from a book that's coming out in 2008, I think. Hazel Crum is particularly good, I think. It's not YA or MG, but I think it's a very instructive example of spinning a story from a photograph.
I might start collecting old photographs...