It's a really common practice for busy websites to serve images from a different server or domain, and I've never seen a Google problem for it. However, I'm not so sure about using free hosts - the service level can be very dicey and cause page load problems and user dissatisfaction.
Sure. But do people buy a hosting plan in other hosting provider just to place an /img folder? Are those images bringing any reward to the main site holding the documents? I mean an image related to theme is considered an indication your page is about that theme.
If you're worried about that then get a subdomain i.e. http://pics.yoursite.tld which is handled by a different server - this is exactly what one of the busiest (if not the busiest) <competitive niche> sites on the net does. He says he has 3 servers to run the site, 2 of which are for images.
I'm no expert on server configuration but I bet you could probably route all requests to your images folder to a different server, behind the scenes. Google doesn't know what happens server-side.
[edited by: Robert_Charlton at 4:47 pm (utc) on July 3, 2009] [edit reason] removed specifcs & delinked example domain [/edit]
I have a lot of images and it is important for me to have them ranked highly since I get tens of thousands of image search referrals every month.
Whilst it may seem to make sense to have one central repository for images (I used to do that however changed it after experimentation) the downside is that Google generally ranks images higher if the images are served from the same domain as the site since the image is, I reckon, perceived to be "owned" by that site.
The question you have to answer is how important are image searches for your site?
If it is not important then no problem, however If they are important/critical it would be best practice to put them on that domain and to ensure all tags and attributes closely identify each image accurately even down to naming the image exactly and not an hexadecimal number or strange shortened format.