- Make a backup of your photos and make sure iPhoto is not running.
- Go into your home directory and into your Pictures folder.
- Delete your library folder.(No worries, you just backed it up, right?)
- Start iPhoto. It will say you don't have a library folder and give you a few choices, one of them being choose where you would like it to be created.
[Editor's note: There's a previous hint that explains how to change the library location in iPhoto, or you could also use a third party app such as iPhoto Library Manager, but the above method worked for me when I tested it -- just make sure you have a backup!]

