Note : I've broken this tutorial down in two parts as it is rather lenghty. This is part I.
This photoshop tutorial will show you how to create a fire effect on a jpeg file of a person. Think of it as creating something along the lines of 'The Human Torch' in photoshop. You can follow along using your own similar file, or you can use the same one I did. Download the starting jpg file here. (I've been informed that I cannot redistribute the royalty free images I purchase - bummer.)
I am no photoshop guru - but I've seen these text fire effects and wanted to attempt to do something similar to a person to see how well it turned out. I don't think it came out too shabby (these images are smaller than the actual ones used) :

Your outcome may vary a bit. I walked through the process fully expecting it to take me many tries. I got the image to look the way I wanted on the second try, and didn't copy down my exact settings. However, as I wrote this tutorial, I did - and it comes out roughly the same depending on a few Photoshop variables.