Go into your profile (click on your user name up at the top right) then go into your control panel, then edit picture. The avatar needs to be 100 pixels x 100 pixels, at most. (I just did mine, pretty easy once you look!)
Yeah...the profile and avatar pics are 2 different ones and show up in different places.
And I'm not sure but there may be a minimum number of posts ya gotta have in order to do a custom avatar. That may be bullocks as it's been quite awhile since I messed with mine.
But anyway, click on your "User CP" in the upper right and then look at the left hand column and you'll find whatcha need.