In the System Preferences it is easy to make your desktop cycle through a series of images. Just open up System Preferences and click the desktop and screen saver section.

At the bottom of the desktop tab there is an option to change the picture for a given amount of time. With this selected, your desktop will cycle through the images in the iPhoto album or folder you have selected.

But what if you want a selection of photos that aren't in an album together, or want to use multiple albums? Open up iPhoto and click on any image. Clicking on the "desktop" button at the bottom will set this image as your desktop background. Select multiple images using shift-click (if they are in a row) or command-click (if they are separated by other photos), and click the desktop button. If you open up system preferences now, you can see that your desktop is set to cycle through these images.

An added quirk is that your screen saver is also set to make a slideshow of these pictures.