"Until recently, you had to edit your photos using client software on your computer," Brian Axe, a Google product management director, said yesterday.
"Today, we're excited to announce that Google has acquired Picnik, one of the first sites to bring photo editing to the cloud."
Financial details of the transaction were not disclosed.
Mr Axe said Google would not be "announcing any significant changes to Picnik today, though we'll be working hard on integration and new features".
He said Google would "continue supporting all existing Picnik partners".
Picnik allows users to import photos from other services such as Picasa, Flickr and Facebook.
Picnik said it had 20 employees and received millions of visitors a month.
"Under the Google roof we'll reach more people than ever before, impacting more lives and making more photos more awesome," Picnik said.
"Google processes petabytes of data every day, and with their worldwide infrastructure and world-class team, it is truly the best home we could have found."
Google's purchase of Picnik comes about three weeks after the internet giant bought Aardvark, a "social search" service that relies on a user's contacts to provide answers to questions.
Google chief executive Eric Schmidt said the company planned to acquire "about one company a month" this year.
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