I would like to send HTML email with graphic elements included. I have no idea to attach garaphics to this email.
The short version is that you are probably best off creating a HTML formatted messages, and using the header parameter of the php mail function.
$headers = "From: sender@example.com\n" .
"MIME-Version: 1.0\n" .
"Content-type: text/html; charset=iso-8859-1";
mail(to@example.com, 'subject line', 'your message text with HTML in it', $headers);
The sitepoint.com article referenced by Jimmy provides an excellent and complete description of your options.