My friend JR pointed me to this trick which is detailed in RFC 2557
It turns out that by using a special data: URL scheme you are able to embed any mime data inside a HTML page, the format is as follows:
data:<mimetype>;base64,<data>
<mimetype> needs to be replaced by the mime-type of your data (image/png for instance) and
<data> is the base64 encoded string of the actual bytes of the file.
For instance, look at the source of the image below, or simply click on it and look at the URL in your browser's location bar.

This technique works in Firefox, Safari, Konqueror and Opera. I think it has great potential! Sadly I can't get it to work in Internet Explorer.
I already can imagine very useful applications for this: captcha images, image uploads in blog posts, ...