Does Google consider the URL of an image?

Matt's answer:
CUTTS: We have a question from Paul Randall from England. Paul asks, “Does Google take into account the URL of an image when searching – e.g. could domain.com/cats/lolcatz/m.jpg appear in the Google search for ‘lolcatz’?” This is a question that I have answered before but it’s worth answering again. Images are hard, right? If you type in “daffodil,” you want to get pictures of daffodils. But people don’t put the text “daffodil,” you know, right in the image where you could OCR it or something like that. So, you have to look at other information around. You have to look in, you know, the metadata for an image. You have to look in the surrounding text. And I think it’s entirely fair for us to look at the URL as well. Now, I wouldn’t try to optimize for Google Image Search by putting domain.com/cats/cats/lolcatz/lolcatz and just repeating the same text over and over and over again because we try to make sure that we do reasonable things and that, you know, just trying to spam doesn’t necessarily work. But I do think it’s fair for us to use all kinds of information that we can to try to say, yes, this image is relevant, this would be a good image to return when the user types in something.
by Matt Cutts - Google's Head of Search Quality Team