Convert an image as a sprite
By default you cannot use any image to be displayed with the “Sprite Renderer” component.
Select your image in the asset folder.
On the Inspector window on the right set the Texture Type as “Sprite”.
Click on the “Apply” button at the bottom right.
Displaying the sprite
Then you can go back into your game object with the sprite renderer component, and drag & drop the image from the asset to the sprite field of the component