Having previously made changes to Google Images in July this year, Google have now introduced Image Search Ads on their results pages. Previously these Ads would include a thumbnail alongside your text ad.
Now Google have expanded the image ad formats on Google Images to include rich media leaderboard ads, above the Google Images search results.
Currently only available to a small fraction of queries in the US and UK only, Google hopes to make display ads on Google Images available on more queries globally in the future.
To start running display ads on Google Images, simply use the Adwords placement targeting tool, target Google Images and choose the type of content you want to appear for. Pricing can be either CPC or CPM.