First, take your large picture and open it up in Photoshop. I chose this one because it's much larger than 40X40 and should give you a decent idea of how to do this with any graphic.
Step 2
Next, resize the image to the smallest you can where you can still make out what the image is. Go to Image>Resize to resize the image. 40X40 was too small for this image because you could not tell what it was. I used 100X100.
Step 3
Now go to File>New to create a new 40X40 image. 72 resolution will be good enough.
Step 4
Now drag the original image into the new 40X40 image you created. Before you can drag, you need to make sure your image is RGB by clicking Image>Mode>RGB Color if it is not already.
Step 5
Now, move the new layer around until you get a good idea of what the original picture was. It doesn't have to show everything, just enough to give someone a taste of what the original picture is. I chose to show some of the dice, and some of the fire.
