Unable to change Desktop Background in Windows 7

If you are unable to change desktop background/wallpaper on Windows 7 or Vista, even after changing themes, follow the steps below.

While holding the Windows logo button on the keyboard, press R to open the Run box.

Copy and paste this into the box, then press enter:

%USERPROFILE%\AppData\Roaming\Microsoft\Windows\Themes\

Delete the TranscodedWallpaper.jpg file, sometimes, you may not be able to find this file since it may be hidden by windows, then, under Folder Options, Select the option to Show Hidden Files or Folders.

Now, try to change your background & you should be able to change the desktop background/wallpaper.

Tried and Tested Solution.