The MammoGrid project aims to deliver a prototype which enables the effective collaboration between radiologists using grid, service-orientation and database solutions. The grid technologies and service-based database management solution provide the platform for integrating diverse and distributed resources, creating what is called a 'virtual organisation'. The MammoGrid Virtual Organisation facilitates the sharing and coordinated access to mammography data, medical imaging software and computing resources of participating hospitals. Hospitals manage their local database of mammograms, but in addition, radiologists who are part of this organisation can share mammograms, reports, results and image analysis software. The MammoGrid Virtual Organisation is a federation of autonomous multi-centres sites which transcends national boundaries. This paper outlines the service-based approach in the creation and management of the federated distributed mammography database and discusses the role of virtual organisations in distributed image analysis.