The Picture Tray works like a temporary folder. When pictures are selected in the tray, you can perform any of the Output Options on them, as well as add Stars or Labels.

To select all the pictures in a folder or label and place them in the Picture Tray, choose Select All from the Folder Title text.

To keep pictures in the tray, select them one at a time and click the Hold button.  You can also drag and drop pictures from Picasa's folders to the Tray and they will automatically be marked Hold. This is useful if you want to work with pictures from multiple folders.

To remove a picture from the Tray, right-click it and choose Remove Selection.

To remove all pictures from the tray, click the Clear button.