Welcome back:

pythonbrew use Python-2.7.1
source $HOME/.venvburrito/startup.sh
workon flask_file_upload

Initial:

pythonbrew use Python-2.7.1
curl -s https://raw.github.com/brainsik/virtualenv-burrito/master/virtualenv-burrito.sh | bash
source $HOME/.venvburrito/startup.sh
# be sure to add the above to your ~/.bashrc
mkvirtualenv --no-site-packages --distribute flask_file_upload
workon flask_file_upload

cd static/js
# download and extract extjs here
wget http://extjs.cachefly.net/ext-4.0.2a-gpl.zip
unzip
ln -s extjs ext-4.0.2a-gpl/
cd ../../

python app.py

See https://github.com/brainsik/virtualenv-burrito#readme

Now to the app itself

http://flask.pocoo.org/docs/patterns/fileuploads/