1. First, decide on a picture. Save it as a PNG and upload it to Photobucket or another image host site. Here's the image I used (it's 30 px by 30 px):
2. From your Blogger dashboard click on Design > Edit HTML.
3. Backup your template by clicking on Download Full Template.
4. Check the Expand Widget Templates box.
5. Press Ctrl F on your keyboard to find something like this:
<a expr:href='data:post.url'><data:post.title/></a>
6. Between the ><, place this:
<img src='Image URL' style='border: 0; margin: 0; padding: 0;'/>
It should now look like this:
<a expr:href='data:post.url'><img src='Image URL' style='border: 0; margin: 0; padding: 0;'/><data:post.title/></a>
7. Replace the part in blue with the direct link to your image. Click Save Template and you're set.