You can use photos and trace over them in Adobe Illustrator to make some unique effects and vector art.
If the vector art resembles the original photo to the average person, then you run into copyright issues. If your trace is going to be somewhat similar to the original photo, then there's one way to get around the copyright issues, and that is to use public domain images. Generally, very old images (number of years depends on the country you live in) and images created by the government (think WWII posters and NASA photos) are in the public domain.
I got this public domain image from Alice in Wonderland book from the 1800s, scanned onto a web site. There are thousands of other images out there in the public domain.
Open a new document in Illustrator, go to File>Place and place the public domain image of Alice. Open the Layers palette and click the Create New Layer button at the bottom of the palette to create a new layer. This is to keep our new vector shapes on their own layer.
You can use various colors for your trace, but for this one I want to keep it simple with just black traces. Use the Pen tool (or the Pencil tool) to trace over the dark parts of this line drawing. Manually tracing allows us greater control and also lower number of paths and anchors than we would have with Live Trace.
For the curvy parts of the drawing, use the Pen tool and click once on one end of the dark area. Next, click-and-drag slightly so the path curves along the shape.
Click to enlarge
Some dark areas are smaller and thinner than others. To avoid a blocky appearance, curve the edges by clicking-and-dragging as you click anchor points with the Pen tool. When you draw back to the original starting point for each shape, hover over the original point and click to close the path.
Click to enlarge
As you draw each shape, try clicking the Eye icon on the Layers palette next to the layer that the original image is on. This will allow you to see just the shapes without the image underneath and help you determine if there are any missing parts.
I added a few new shapes which make this trace look a bit different from the original photo. These ripples I made using the Pen tool make the girl look like she's standing in water.
Her hand ended up being awkwardly in the air, so I added a cigarette. (I don't smoke, but hey, this Alice does).
Here's the original image next to the vector illustration that I traced from it.
I've also included a few examples of public domain images you can trace over for unique art. Check them out. You might get some great ideas.
You can also find many resources linked at the bottom of this Wikipedia entry.