Upload photo error

Hi

I just set up wordpress. I was trying to upload a photo file using the upload panel in the write new post area.

After selecting the photo from my harddrive, i click ok and got this error —
“The uploaded file could not be moved to .”

I ftp into the folder and found the file not uploaded. But theres no problem if i upload via ftp. i need the upload feature in wordpress as other users dont know how to ftp.

Any sort of reply would be appreciated. Thanks in advance.

Regards
sk