PHP comes bundled with GD (GIF Draw/Graphics Draw), which is a library for the dynamic creation of images. It can be used for simpler image operation, such as resizing, cropping, adding watermarks, creating thumbnails (Jeffrey wrote about it), applying basic photo filters - you've probably used it before. Unfortunately, if you want to create something more complex with GD, like Instagram effects, you can't. Luckily, though, we have ImageMagick!
He starts off by comparing the two graphics libraries and talks briefly about how to downliad and install Imagemagick on your development platform. Included is a PHP class to help you use it, coming complete with functions for changing the color tone of the image, adding a border and adding a vignette to the image. Also included are some "presets" represented in a few simple functions:
There's also a few links to other resources you can use to find out more details on what Imagemagick has to offer.