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From WiKirby

Direct linked images means when you post an image from another website without using the uploader or getting their permission to consume their bandwidth.

In some cases, people on the bad end of image-linking (namely the webmasters who host the images) who find out that somebody is stealing their bandwidth, takes steps to ruin their reputation. If you don't want a similar scenario to happen to you, we suggest you don't do it either, and use an image host such as Photobucket or Imageshack to host your images.