Oh my! I heard from far and wide, from friends and strangers: I want to re-arrange my Spaces Photos pictures, how can I do it? All I did was mention Photos and Slide Show in my last blog, and somehow struck a nerve. If you have not seen it elsewhere, here it is again: Our friends at Windows Live had been working hard to provide the tools and functions you want. Yes, you can, re-arrange the order of your pictures by just dragging and dropping.
Here is how it is done:
First make sure you have Silverlight installed. If you don’t have Silverlight, or are not sure, go here: Microsoft Silverlight – It will tell you if you have it, and let you install from there if you don’t.
Now, sign into your account and go to the folder in your Photos site where you want to customize the order. Click on Sort by: Then select Arrange photos.
In the new window you will be able to drag and drop – arrange your photos the way you want.
Note how the the photo you are dragging fades out and photos will spread apart and make room as you drag a photo to a new location. What could be neater?
Happy now?
This 'n That 
That\’s great, but how can you rearrange the photo albums?
Unfortunately, this does not work in the latest version of Windows Live Photo, at least as far as I can see. Was the feature removed? (This makes me long for my iPhoto!)
The “arrange” feature is still there. Unfortunately the Windows Live folks, in their great wisdom, have seen fit to relocate the “Sort by” command to show under “More”. If you look at an older album the “Sort by” command is on the menu line. After a change is made it disappears – really it is relocated to show under the “More” command. Still works as nicely, however. Maybe this change is for my benefit so I can revise my books and sell more – honestly, I did not ask for this!
Does this work in Windows 7
You need to have Silverlight installed. The picture drag-and-drop feature works in your browser, so you need to use Internet Explorer (it is on your computer). It may also work in some other browsers. If you are not sure about Silverlight, click the Start orb and type “silverlight”, if you have it, it will show in the start menu as “Microsoft Silverlight”. If it is not there, you can download it (it is free) from Microsoft at: http://explore.live.com/windows-live-essentials Good luck, and enjoy!
After I followed the instructions (downloading the latest version of Silverlight) and using Internet Explorer, I still cannot get the “drag-and-drop” to work. All I get is the circle with the red bar across it. HELP!
There have been many recent changes to SkyDrive. Arranging the order is easier than ever. In answer to your question, here is a post explaining it: Arranging the order of photos in a SkyDrive album