If you want a usable data-URI representation of the image, then I suggest to load the image in a <img> tag, paint it on a <canvas> then use the .toDataURL() method of the canvas.

Otherwise, you need to use XMLHttpRequest to get the image blob (set the responseType property on the XMLHttpRequest instance and get the blob from the .response property). Then, you can use the FileReader API as usual.

In both cases, the images have to be hosted on the same origin, or CORS must be enabled.

If your server does not support CORS, you can use a proxy that adds CORS headers. In the following example (using the second method), I'm using CORS Anywhere to get CORS headers on any image I want.

var x = new XMLHttpRequest();

x.open('GET', '//cors-anywhere.herokuapp.com/http://www.youtube.com/favicon.ico');

x.responseType = 'blob';

x.onload = function() {

    var blob = x.response;

    var fr = new FileReader();

    fr.onloadend = function() {

        var dataUrl = fr.result;

        // Paint image, as a proof of concept

        var img = document.createElement('img');

        img.src = dataUrl;

        document.body.appendChild(img);

    };

    fr.readAsDataURL(blob);

};

x.send();

The previous code can be copy-pasted to the console, and you will see a small image with YouTube's favicon at the bottom of the page. Link to demo: http://jsfiddle.net/4Y7VP/