Step 1: Open Picasa and scroll to the folder that contains your scanned photos. Here's mine with some Hallowe'en pictures of my kids.
Step 2: Highlight (select) the photos you want in your collage. Don't pick too many or they will be rather small on your page. Click the little green button in your tray (bottom of the Picasa screen) to hold each photo you choose.
I've placed my cursor over that icon so you can see the little bubble "HOLD SELECTED ITEMS" that pops up.
You can also see the 5 photos I've chosen sitting in my tray. Click on COLLAGE (Orange icon at bottom)
Step 3: My collage was created. It is a Picture Pile (see top left under SETTINGS. It's a pile of scattered pictures but I have the ability to enlarge, move and tilt each photo.
I've selected one photo so you can see the little wheel that pops up on it. This wheel lets you drag on the hand to enlarge the photo, or rotate the wheel to tip it
Step 4: Under SETTINGS, I now chose MOSAIC. It automatically fits the chosen photos into the page. There are other choices too, you can have some fun playing with this. Your collage is not "set" until you click the CREATE COLLAGE button.
Step 5: Here I slid the GRID SPACING level along to the right to create nice big wide white spaces between those photos in the MOSAIC setting. This will allow me to add text once I create my collage
Step 5: Once I was happy with Step 4, I clicked on CREATE COLLAGE and this was the result. Now I can add text anywhere I wish on the collage. I can choose fonts, sizes and colours. There is more you can do, once again you can have fun playing. Your text isn't set until you click on APPLY.
Have fun and enjoy creating your Photo Collages!