The Best in Encryption and File protectionTrueCrypt is a free open source on-the-fly encryption (OTFE) program for Microsoft Windows 2000/XP/2003/Vista and Linux. It can create a "file-hosted container" which consists of an encrypted volume with its own file system, contained within a regular file, which can then be mounted as if it were a real disk. TrueCrypt also supports device-hosted volumes, which can be created on either an individual partition or an entire disk.
Plausible deniabilityOne of the notable features of TrueCrypt is that it provides two levels of plausible deniability, which might be useful in case a user is required to reveal the password of an encrypted volume.
Hidden volumesHidden volumes are a steganographic feature that allows a second, "hidden" TrueCrypt volume to be created within the free space of another TrueCrypt volume.[3] The hidden volume can have its own separate file system and uses a different password, encryption algorithm and encryption key from that of the host volume, referred to as the "outer" volume. Which volume is actually mounted depends on the password provided; if the password to the outer volume is provided, the outer volume is mounted, and likewise for the inner volume.
Once a hidden volume has been created inside another TrueCrypt volume, the user will store important-looking information (but which the user does not actually want to hide) on the outer volume, whereas sensitive information is stored within the hidden volume.
In the event the hidden volume user is forced to reveal their TrueCrypt password, they can divulge the password to the outer volume (not disclosing the fact that they actually have a hidden volume within), and sensitive data within the hidden volume is not compromised.
No identifying featuresTrueCrypt volumes, be they stored in a file or a device/partition, intentionally do not contain any discernible "signatures" or unencrypted headers. As cipher algorithms are designed to be indistinguishable from a pseudorandom permutation without knowing the key, the presence of encrypted data is also undetectable unless the cipher has weaknesses. This means that it is impossible to prove that any file or partition is a TrueCrypt volume (rather than random data) without having the password to mount it.
This characteristic also makes it impossible to determine if a volume contains another hidden volume.
Also the Truecrypt instalation itself can be installed in any location, even on a removable disc.Get it.
http://www.truecrypt.org.