I wrote a post a few weeks ago about this. What Liana's recommending really hasn't been my experience, at least not if we're to assume she's including Google in the strategy she describes. Here's what I wrote:
QUOTE
I can tell you this much: Yahoo is very interested in the alt attribute.
I was checking the rankings on one of my sites yesterday, and when I ran one of the phrases through, I noticed that two images from my site were coming up in the little top four "Image Results" preview on the SERP, so I clicked through to see the full image results. Of the top 20, my site had numbers 2, 4, 5, 7, 10, and 17. Each of the images has the two-word phrase as the first two words of the alt attribute and the only other place on the pages where any part of the phrase appears is in the title tag, where a variation on the second word appears. The keywords are also not in the links to the pages on which these images appear, although they are all over the site. One other thing, and I have no way of knowing based on this whether this makes a difference: all of these images are linked, but they're linked to copies of themselves (some of them to the exact same file, some to a larger version) outside of a page, where they obviously have no place for the keywords to appear, except in the file name, where they are not present.
The home page of the site comes up at #15 for the phrase in the normal results, by the way.
And in case you're interested, this is very different from the results at Google: the site's home page is #5 for the phrase, and on the image search, one picture from the site comes up, at #7. That image does not have the phrase in its alt attribute, but the phrase is the first two words of the page's title tag.