Can reviewing papers help increase your credibility as a researcher? I was wondering if reviewing papers for established journals was a way to increase ones credibility as a researcher? 

My question is related to the fact that the journal editors, that are (frequently) known scientists in your domain, will read the review you made. 

I was wondering if we can therefore assume that they will, to some degree, evaluate your reviewing work, and therefore yourself as a scientist, based on your review? Lets imagine I know the editor, and I might want to have a position in his/her lab, then my reviewing work might weight in my evaluation?
Yes, it helps in more than one way.  Community service is a relevant part on an academic CV.  Although reviewers for individual papers are normally secret, it does not need to be secret that you have reviewed articles for journal X.  You can write that you have done so on your CV, and if needed (but I don't think it should be), a journal editor can confirm.

It works the other way around too: being asked to review a paper is an independent confirmation of your credibility as a researcher.  The first times it happened to me, it was really an ego boost.  Wow, someone else than my supervisor thinks I know something about something!  Great!