Open iPhoto by clicking its icon in the dock.
Select a photo you would like to crop. If you don't have the photo in iPhoto then just simply drag and drop it into the iPhoto window.
Press Command-d on the keyboard to duplicate the photo you would like to crop.
Select the duplicated photo and click the Edit button at the bottom of the window.
You will now be in Edit mode. Click the Crop icon at the bottom of the window to enable the crop tool.
Crop options will now appear over your image. There will be a white rectangle with handles on each corner overlayed on your photo. Drag these handles to make the rectangle frame the area to be selected.
If you like you can constrain the rectangle to certain proportions. To do this, check the box next to Constrain and select a ratio from the dropdown box.
Once you have framed the area you would like to crop to, click the Apply button to crop the image.
Click Done to exit Edit mode.
You should now see your cropped photo!