Web forms that allow you to upload files typically insist on clicking on a "Submit" button to upload the file to the web server.
Most input data can be submitted to the web server from the client using Ajax, thus bypassing a "Submit" button. However file data cannot be serialized and passed to the web server with Ajax.
The only issue here is that, we have no control over how the submit() call renders data. One specific issue is that this call would cause the whole form to re-load which results in the user losing any other data she may have entered on the same page.
It is possible to use an iFrame within the form, include the file input field within the iFrame and call iFrame.form.submit() to upload the file. Then only the iFrame will be re-loaded and the rest of the form will remain intact.
GMail uses a technique similar to this, that allows them to "see" the attachment before the user clicks "Send" on the email - this is a very useful feature, as users immediately get feedback, GMail can perform validations - eg: virus checks - on the file as the user is composing the email etc.
Examine the html at http://livemocha.com/profiles/create to get an idea
This is a feature that is now available at http://www.livemocha.com/profiles/basic - check it out so you can see some more nice interactions. For example, you can immediately show the new picture uploaded to the user - normally this is difficult to do on the web browser, as on the client we have no access to the local file system.