TrueCrypt provides free open-source disk encryption software that creates an encrypted virtual disk that mounts like a real disk. It can encrypt an entire partition, storage device, or file container. The encryption is automatic, fast, and transparent to the user, allowing them to copy files to and from an mounted TrueCrypt volume like normal. After moving sensitive data to the encrypted volume, the original unencrypted files should be securely erased. TrueCrypt does not save any decrypted data to a disk.

1. TrueCrypt
TrueCrypt provides free open-source disk encryption
software for Windows 7/Vista/XP, Mac OS X, and Linux.
It creates a virtual disk that is entirely encrypted
(including file names, folder names, contents of every file,
allocation tables, free space, meta data, ect.) and mounts
as if it was a real disk. It can encrypt an entire partition or
storage device such as a USB flash drive or hard drive.
The encryption is automatic, fast, and transparent to the
user. You can copy files and folders to and from a
mounted TrueCrypt volume just like you would normally
do. Keep in mind that after you drag-and-drop all your
sensitive data into your TrueCrypt volume, you should
securely erase the original unencrypted files. TrueCrypt
does not save any decrypted data to a disk rather it only
stores data temporarily in RAM (memory).
Go to the Internet and enter the URL www.truecrypt.org
Download the latest version which at this writing is
TrueCrypt Setup 7.1a.exe (3.3 MB) .

2. Follow the default installation procedures to install
TrueCrypt. Start TrueCrypt and click No when asked to view
the tutorial.
The main TrueCrypt window appears.
Click on the Create Volume button.

3. You have three options. A TrueCrypt volume can reside in a file
(called a Container), in a partition or drive. A TrueCrypt container
can be moved, copied, and deleted like a normal file. Click Next.
Click Next.

4. Click Select File…
Change the directory path to your Desktop. In the file name box
enter TrueCrypt Encrypted Volume. Click Save
Click Next.

5. Click Next.
Enter 1 MB for the Volume Size. Click Next.

6. Read and then create and confirm a secure password.
Move your mouse randomly within the Volume Creation Wizard
window for at least 30 seconds. The longer you scribble , the
better. This significantly increases the cryptographic strength of
the encryption keys (which increases security). Click Format.

7. Click OK.
Click Exit.

8. Now you will mount the container as a volume. Select the X:
drive letter by clicking on it. Click Select File.
Navigate to the Desktop folder and click on TrueCrypt Encrypted
Volume. Click Open.

9. Click Mount.
Enter your Password and click OK.

10. You can view the successfully mounted volume.

11. Create a file in Wordpad.
Save as TrueCrypt Encrypted in the TrueCrypt container you
created.

12. Access your container in the X: drive and open the document
TrueCrypt Encrypted. It is just as fast as opening up the
unencrypted version.
Important: Note that when you open a file stored on a TrueCrypt
volume (or when you write/copy a file to/from the TrueCrypt
volume) you will not be asked to enter the password again. You
need to enter the correct password only when mounting the
volume.
In order to close the volume and make your files inaccessible
click Dismount.
Exit.