How to create images inside of an image?

That is a Photo Mosaic:

That has been broken out into two sections, one before combining it with the master photo to make it look like it is a photo created from other images. Then you stack the grid of images on top of the Photo Mosaic and use displacement 
effects like Card Dance or scatterize, or Ball Action + some glows and other color effects to get the pull back (zoom out) on the grid, slowly transition to a single image and scater the pixels a bit look. 

The better you prepare the original layered Photo Mosaic, the more success you will have in transitioning it to a particleized version of the final image. 

There are just two basic transitions. The first from the checkerboard of images to the Photo Mosaic, then the transition to the glowing particles that move a bit. There are a couple dozen ways to break up a layer into little bits. Card Dance, Ball Action, and Scatterize are only three of them.

I hope this gets you started.