I\'ve read somewhere that element behaves like both. If correct, could someone please explain with examples?
An img element is a replaced inline element.
It behaves like an inline element (because it is), but some generalizations about inline elements do not apply to img elements.
e.g.
Generalization: "Width does not apply to inline elements"
What the spec actually says: "Applies to: all elements but non-replaced inline elements, table rows, and row groups "
Since an image is a replaced inline element, it does apply.