By default, the first picture in any event is what’s shown as its key photo (i.e., the thumbnail that you’ll see when you’re not scrolling over the event). If your library is anything like mine, though, that can be rather unfortunate. So how do you change the key photo to something more pleasing? The absolute drop-dead easiest way is to drag your mouse over the event until you see an image you like, then tap the spacebar. When you do, whatever image was showing up in the thumbnail is now set as the key photo. Cool beans!
Of course, there are tons of other ways you can change the key photo, too, but they aren’t nearly as convenient. For example, you can right- or Control-click on an event when you find a picture you like, and iPhoto will bring up a contextual menu. Choose Make Key Photo from that, and you’ve accomplished the same thing.
If you’ve double-clicked on an event to open it and are looking at your photos individually, you have a couple of different options. First, you can select an image and choose Events > Make Key Photo from the menu bar.
Alternatively, click on the small arrow that appears when you hover over an image for a menu with the same option.
These methods work to set key photos for the Faces section, too. So go ahead and choose images that are as pleasing or as dorky as you want.
You can tell which way I went.