Just encountered an issue where WordPress cannot resize my uploaded photograph to thumbnail, small or medium. All the radio buttons are grayed out but the full size option.
This is due to a certain module not installed. If you are using Ubuntu:
sudo apt-get install php5-gd
If you don’t have access, you might have to advise your web host to do so.
GD library is a simple image processing library used by WordPress to perform resizing and cropping.