If you are trying to import JPEG images produced with Adobe Photoshop into an XFA-based form in LiveCycle Designer, then you may notice the following error in the warning palette:
Error reading JPeg file : JFIF supports only 1 and 3 component streams. XFAImageService: Image cannot be resolved for node: StaticImage1
1. Use Photoshop version 6 or less to produce the JPEG images
2. Re-save the JPEG images from Photoshop using the “Save for Web…” option in the File menu
3. Re-save the JPEG images using Paint in windows, or any other image editing tool which does not add the preview information described below
This error occurs when Photoshop 7 or greater was used to create the JPEG images. This is due to a change in the JPEG format produced with Photoshop 7 and greater, which now includes a thumbnail preview of the JPEG image included in the JPEG profile. Such profile information does conform to the JPEG/JFIF specification, however some applications like web browsers, or in this case, LiveCycle Designer cannot handle the preview data correctly.
Further information can be found below: