Microsoft released a new software program today called Private Folder. The software creates a folder called my private folder which can be password protected so that no one but you or authorized users can access its contents. The folder works just like any other on the folder on the operating system, but with the difference that a password prompt is displayed on first access. Windows Genuine Advantage will check twice if your computer is running a legit copy of Windows XP before it lets you install the program on your system.
A freeware alternative without WGA that is more powerful than the Microsoft program is True Crypt. You simply create a container on one of your hard drives and mount if whenever you want to use it. True Crypt has another advantage: It is available for all recent versions of Windows and Linux. Take a look at my basic True Crypt tutorial that I have written a while ago to get acquainted with the program.
True Crypt has another advantage over private folders. No one knows that there is a hidden container on your hard disk. As long as you do not mount the container it is hidden and not accessible at all. Private folders are always there and make the curious even more curious in my opinion.
Update: Interested users can download Private Folder from Ghacks.net, the download appears to be no longer available on the Microsoft website: MSPF10ENU
It needs to be considered that Private Folder is only available for Windows XP and earlier versions of Windows. Depending on the version of Windows used, you may have access to Microsoft's Bitlocker technology that can also encrypt data on your operating system. If you do not have Bitlocker available to you, I suggest you check out True Crypt instead which works on all systems and editions.
Additional information about BitLocker Drive Encryption can be found here on this Microsoft page.
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Ghacks is a technology news blog that was founded in 2005 by Martin Brinkmann. It has since then become one of the most popular tech news sites on the Internet with five authors and regular contributions from freelance writers.