In Genesis 1:26 we read that we were made in God's image.
In 2 Corinthians 3:18 we read that we are transformed into His image.
How does being transformed into His image relate to our having been made in His image?
The Greek word in 2 Corinthians 3:18 is μεταμορφόω (metamorphoō), wherein we recognize the English word, metamorphosis. Exactly the same word is used to describe the transfiguration of Christ:
Matthew 17:2 (KJV)
And was transfigured before them: and his face did shine as the sun, and his raiment was white as the light.
καὶ μετεμορφώθη ἔμπροσθεν αὐτῶν, καὶ ἔλαμψε τὸ πρόσωπον αὐτοῦ ὡς ὁ ἥλιος, τὰ δὲ ἱμάτια αὐτοῦ ἐγένετο λευκὰ ὡς τὸ φῶς.
Mark 9:2 (KJV)
And after six days Jesus taketh with him Peter, and James, and John, and leadeth them up into an high mountain apart by themselves: and he was transfigured before them.
Καὶ μεθʼ ἡμέρας ἓξ παραλαμβάνει ὁ Ἰησοῦς τὸν Πέτρον καὶ τὸν Ἰάκωβον καὶ τὸν Ἰωάννην, καὶ ἀναφέρει αὐτοὺς εἰς ὄρος ὑψηλὸν κατʼ ἰδίαν μόνους· καὶ μετεμορφώθη ἔμπροσθεν αὐτῶν·
Paul also uses the same word in Romans 12:2:
And be not conformed to this world: but be ye transformed by the renewing of your mind, that ye may prove what is that good, and acceptable, and perfect, will of God.
καὶ μὴ συσχηματίζεσθε τῷ αἰῶνι τούτῳ, ἀλλὰ μεταμορφοῦσθε τῇ ἀνακαινώσει τοῦ νοὸς ὑμῶν, εἰς τὸ δοκιμάζειν ὑμᾶς τί τὸ θέλημα τοῦ Θεοῦ, τὸ ἀγαθὸν καὶ εὐάρεστον καὶ τέλειον.
Some versions translate metamorphoō as simply "change" in the Corinthians verse (e.g. KJV), but I think this sells the word a bit short. The Greek word does not imply being changed from one thing to something different, but rather - following the example use as "transfiguration" - being changed from one thing to a higher form of the same thing.
This, I think, is the relation to man's having been created in the image of God (1 Genesis 1:26). Man was created in the image of God but, as a result of the fall, that image was obscured. In 2 Corinthians, Paul is describing the process of that image being recovered. As one Byzantine theologian, Gregory Palamas, explained, the human soul possesses the image of God "even if it does not recognize its own dignity."
After our forefather's transgression in paradise through the tree, we suffered the death of our soul - which is the separation of the soul from God - prior to our bodily death; yet although we cast away our divine likeness, we did not lose our divine image. Thus when the soul renounces its attachment to inferior things and cleaves through love to God and submits itself to Him through acts and modes of virtue, it is illuminated and made beautiful by God and is raised to a higher level, obeying His counsels and exhortations; and by these means it regains the truly eternal life.*
* Topics of Natural and Theological Science XXXIX, in The Philokalia, vol. 4 (tr. from Greek; Faber and Faber, 1995), p.363