Fat-free script to add Album functionality to your wordpress media library. The idea is to register a new taxonomy named 'album'. Simply paste album_wordpress.php script to your functions.php in your theme folder, or include this album_wordpress.php in functions.php. This is very basic. Fell free to use and modify.

album_wordpress.php

<?php
/* paste this to functions.php or include */

register_taxonomy('album','attachment',
    array( 
        'hierarchical' => true, 
        'label' => 'Albums',
        'show_ui' => true,
        'show_admin_column' => true,
        'update_count_callback' => 'fix_album_count',
        'query_var' => true,
        'rewrite' => true,
        'singular_label' => 'Album',
	'capabilities' => array(
	    'manage_terms' => 'edit_posts',
	    'edit_terms' => 'edit_posts',
	    'delete_terms' => 'edit_posts',
	    'assign_terms' => 'edit_posts'
	    )
    ) 
);
register_taxonomy_for_object_type('album','attachment');
function fix_album_count(){
    global $wpdb;
        $sql = "UPDATE $wpdb->term_taxonomy tt
		SET tt.count =
		(SELECT count(p.ID) FROM  $wpdb->term_relationships tr
		LEFT JOIN $wpdb->posts p
		ON (p.ID = tr.object_id AND p.post_type = 'attachment')
		WHERE tr.term_taxonomy_id = tt.term_taxonomy_id)
		WHERE tt.taxonomy = 'album'
	";
	$wpdb->query($sql);
}
// to populate the albums, simply use get_terms('album',$args) function in your template file.
// reference http://codex.wordpress.org/Function_Reference/get_terms

taxonomy-album.php

<?php 
/* example to parse an album */
get_header();
$term =  $wp_query->queried_object; 
?>
<h1><?php echo $term->name; ?></h1>
<?php
    $args = array(
		'post_type' => 'attachment',
		'numberposts' => -1,
		'post_status' => 'inherit',
		'album' => $term->slug,
		);
		
		$attachments = get_posts( $args );
		 if ( $attachments ) {
			foreach ( $attachments as $attachment ) {
        // echo all images
				echo wp_get_attachment_image( $attachment->ID );   
			}
		 } ?>
    <p><?php echo $term->description; ?></p>
<?php get_footer(); ?>