There's a "Show pictures" button that'll appear at the top of the email, same as in desktop GMail. As with the desktop UI, when you press that button it'll change to a "Always show pictures from this sender" button.
You do it on a sender-by-sender basis. If there's a way to always show images from any sender, I don't know what it is (and wouldn't use it, I don't want to see images in spam emails etc.).