If you aren't running Windows 7, or you want to use something other than a Microsoft product (and don't want to spend any money), TrueCrypt from the TrueCrypt Developers Association is pretty hard to beat.
The product matches the features offered by Microsoft's BitLocker and offers a couple of interesting additional features, such as the ability to create a virtual encrypted volume that is mounted as a drive letter or associated with a virtual folder. In other words, you can store all of your critical data files on a separate, encrypted disk volume and then access those data files by associating a drive letter with the volume and entering the associated passkey. That way you can allow others to use your PC while your sensitive data is protected from prying eyes.

That method offers several advantages. First off, you can "hide" the encrypted volumes, so other users don't even know that they exist. You can also segregate your data files, only encrypting what you deem important. And finally, you do not need to encrypt your application or operating system files, which means the system won't take as much of a performance hit.

TrueCrypt uses several different encryption algorithms, including AES, Serpent and Twofish. Those algorithms can be combined in many different ways to create complex encryption schemes

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