diff --git a/jhub_apps/service/models.py b/jhub_apps/service/models.py
index 7edd5f51..c2555160 100644
--- a/jhub_apps/service/models.py
+++ b/jhub_apps/service/models.py
@@ -2,6 +2,7 @@
 from datetime import datetime
 from typing import Any, Dict, List, Optional
 
+
 from pydantic import BaseModel
 
 
@@ -51,7 +52,7 @@ class UserOptions(BaseModel):
     jhub_app: bool
     display_name: str
     description: str
-    thumbnail: typing.Optional[str] = str()
+    thumbnail: str = None
     filepath: typing.Optional[str] = str()
     framework: str = "panel"
     custom_command: typing.Optional[str] = str()
diff --git a/jhub_apps/service/service.py b/jhub_apps/service/service.py
index b7953408..56405f8d 100644
--- a/jhub_apps/service/service.py
+++ b/jhub_apps/service/service.py
@@ -1,8 +1,11 @@
+import typing
 import dataclasses
 import os
 from datetime import timedelta
 
-from fastapi import APIRouter, Depends, status, Request
+from fastapi import APIRouter, Depends, status, Request, File, UploadFile, Form, HTTPException
+from fastapi.encoders import jsonable_encoder
+from pydantic import BaseModel, ValidationError
 from starlette.responses import RedirectResponse
 
 from jhub_apps.service.auth import create_access_token
@@ -14,7 +17,8 @@
 from fastapi.templating import Jinja2Templates
 
 from jhub_apps.hub_client.hub_client import HubClient
-from jhub_apps.service.utils import get_conda_envs, get_jupyterhub_config, get_spawner_profiles
+from jhub_apps.service.utils import get_conda_envs, get_jupyterhub_config, get_spawner_profiles, \
+    encode_file_to_data_url
 from jhub_apps.spawner.types import FRAMEWORKS
 
 app = FastAPI()
@@ -62,6 +66,7 @@ async def login(request: Request):
     authorization_url = os.environ["PUBLIC_HOST"] + "/hub/api/oauth2/authorize?response_type=code&client_id=service-japps"
     return RedirectResponse(authorization_url, status_code=302)
 
+
 @router.get("/server/", description="Get all servers")
 @router.get("/server/{server_name}", description="Get a server by server name")
 async def get_server(user: User = Depends(get_current_user), server_name=None):
@@ -81,12 +86,31 @@ async def get_server(user: User = Depends(get_current_user), server_name=None):
         return user_servers
 
 
+class Checker:
+    def __init__(self, model: BaseModel):
+        self.model = model
+
+    def __call__(self, data: str = Form(...)):
+        try:
+            return self.model.model_validate_json(data)
+        except ValidationError as e:
+            raise HTTPException(
+                detail=jsonable_encoder(e.errors()),
+                status_code=status.HTTP_422_UNPROCESSABLE_ENTITY,
+            )
+
+
 @router.post("/server/")
 async def create_server(
-    # request: Request,
-    server: ServerCreation,
+    server: ServerCreation = Depends(Checker(ServerCreation)),
+    thumbnail: typing.Optional[UploadFile] = File(...),
     user: User = Depends(get_current_user),
 ):
+    if thumbnail:
+        thumbnail_contents = await thumbnail.read()
+        server.user_options.thumbnail = encode_file_to_data_url(
+            thumbnail.filename, thumbnail_contents
+        )
     hub_client = HubClient()
     return hub_client.create_server(
         username=user.name,
diff --git a/jhub_apps/service/utils.py b/jhub_apps/service/utils.py
index 5c78f605..0e99f160 100644
--- a/jhub_apps/service/utils.py
+++ b/jhub_apps/service/utils.py
@@ -1,3 +1,4 @@
+import base64
 import os
 
 from jupyterhub.app import JupyterHub
@@ -44,3 +45,14 @@ def get_spawner_profiles(config):
         raise ValueError(
             f"Invalid value for config.KubeSpawner.profile_list: {profile_list}"
         )
+
+
+def encode_file_to_data_url(filename, file_contents):
+    """Converts image file to data url to display in browser."""
+    base64_encoded = base64.b64encode(file_contents)
+    filename_ = filename.lower()
+    mime_type = "image/png"
+    if filename_.endswith(".jpg") or filename_.endswith(".jpeg"):
+        mime_type = "image/jpeg"
+    data_url = f"data:{mime_type};base64,{base64_encoded.decode('utf-8')}"
+    return data_url
diff --git a/jhub_apps/tests/test_api.py b/jhub_apps/tests/test_api.py
index 8becd8cd..f357b7f3 100644
--- a/jhub_apps/tests/test_api.py
+++ b/jhub_apps/tests/test_api.py
@@ -1,4 +1,6 @@
 import dataclasses
+import io
+import json
 from unittest.mock import patch
 
 from jhub_apps.hub_client.hub_client import HubClient
@@ -34,16 +36,22 @@ def test_api_get_server(get_user, client):
 @patch.object(HubClient, "create_server")
 def test_api_create_server(create_server, client):
     from jhub_apps.service.models import UserOptions
-
     create_server_response = {"user": "aktech"}
     create_server.return_value = create_server_response
     user_options = mock_user_options()
-    body = {"servername": "panel-app", "user_options": user_options}
-    response = client.post("/server/", json=body)
+    thumbnail = b"contents of thumbnail"
+    in_memory_file = io.BytesIO(thumbnail)
+    response = client.post(
+        "/server/",
+        data={'data': json.dumps({"servername": "panel-app", "user_options": user_options})},
+        files={'thumbnail': ('image.jpeg', in_memory_file)}
+    )
+    final_user_options = UserOptions(**user_options)
+    final_user_options.thumbnail = "data:image/jpeg;base64,Y29udGVudHMgb2YgdGh1bWJuYWls"
     create_server.assert_called_once_with(
         username=MOCK_USER.name,
         servername="panel-app",
-        user_options=UserOptions(**user_options),
+        user_options=final_user_options,
     )
     assert response.json() == create_server_response