Add Image in Magento Admin Product Grid

Step 1:
  First you need to copy the core block to local. Copy Grid.php from       app/code/core/Mage/Adminhtml/Block/Catalog/Product/Grid.php to
  app/code/local/Mage/Adminhtml/Block/Catalog/Product/Grid.php


Here you'll find a method named _prepareColumns(), add the below code within this method
 If yoy edit in Notepad++ go to the line number 145.
       

$this->addColumn('product_image', array(
              'header'    => Mage::helper('catalog')->__('Image'),
              'align'     =>'left',
              'index'     => 'entity_id',
              'width'     => '100px',
              'renderer'  => 'Mage_Adminhtml_Block_Catalog_Product_Renderer_Image'
        ));


Step 2: 
    Now create the renderer file named Image.php in the following path
    app/code/local/Mage/Adminhtml/Block/Catalog/Product/Renderer/Image.php
    Here add the below code..
   
class Mage_Adminhtml_Block_Catalog_Product_Renderer_Image extendsMage_Adminhtml_Block_Widget_Grid_Column_Renderer_Abstract
    {
        public function render(Varien_Object $row)
        {
            $_product = Mage::getModel('catalog/product')->load($row->getEntityId());
            if($_product->getImage() != 'no_selection'){
                  $image = "<img src='".Mage::helper('catalog/image')->init($_product, 'image')->resize(100)."' title='".$_product->getName()."' />";
            }
            return $image;
        }

    }