The little flash devices are the modern day floppy disk and are handy, but they are also easy to forget about and leave on a table at a cafe or attached to a borrowed computer somewhere. Most people carry enough information on their thumb drives in the form of saved e-mails, spreadsheets, word processing documents and photos for their identities to be stolen.
Encrypting the files with free software before the drive is lost protects your privacy.
What is encryption and why is it so important?
Encryption scrambles the data in a way that the data cannot be accessed without a virtual key, or password, to unscramble the data. With the right type of encryption it is almost impossible for another computer to unscramble the data without a password. In most cases, identity thieves and hackers will try to guess your password, so it is important to choose a password that is difficult to guess and is not a standard word in a dictionary because most hackers have automated programs that try to break in using every word in the dictionary. Microsoft offers a free online password strength tester and notes about creating passwords that cannot be easily guessed.
Encrypting your thumb drive in Mac OS X 10.5
OS X has encrypted disk images built in from the ground up, so no extra software is needed. Insert the flash drive into the Mac where it mounts on the desktop and open Disk Utility, which is located in the Applications/Utilities Folder. Click File> New > New Blank Image. Next, a dialogue box appears with several options. Specify the name of the file in the Save as: box. Whatever you type in Volume Name is what the disk image volume name will show up as on your desktop when it is mounted. For Volume Size, choose about 80 percent of the flash drive size. For instance, if you have a 1GB portable flash drive, then you would want a 800 MB volume size. Leave Volume Format at the default Mac OS Extended (journaled). Under Encryption, specify 128-bit AES. 256-bit offers better encryption but it cannot be used on a Mac that is still running 10.3 or 10.4.
Leave Partitions to the default of Single partition - Apple Partition Map. Under Image Format, choose sparse disk image. This will allow the disk image to grow as you add files. That means you can upgrade to a larger thumb drive later without having to recreate the disk image.
Encrypting your thumb drive in Mac OS X 10.4
Mac OS 10.4 doesn’t have as many options for disk image creation as 10.5. You only need to specify size encryption and format. Choose 128-bit AES for encryption and sparse image for format.
Don’t give away your password
Click save and another window will ask you for your password. De-select the Remember password in my keychain option or that computer can access the disk image without a password.
Next, simply copy the disk image to the thumb drive.
Using the the disk image on another Mac
Just insert the flash drive, double-click the disk image and it will ask for the password. Do not select the Remember password in my keychain option or you will be giving your password to that computer permanently. Now the disk image should show up on the Mac like another hard drive or flash drive where you can open and save files to. If you open the flash drive itself, only the disk image itself should be visible.
Encrypting your thumb drive in Windows
Windows does not have the same built-in encryption capabilities that Mac OS X does, but Trucrypt, a free encryption program for Windows and Linux offers the ability to create an encrypted file like a disk image in Mac OS X. Truecrypt calls the file a container file since other files are stored inside of it. By default, truecrypt must be installed on every computer where you want to access the container file. But with some tweaking, truecrypt can be taught to run in what is called ‘traveler mode’ where the program that decrypts the files runs directly from the flash drive and does not require any software to be installed. But knowledge of registry editing is required.
Truecrypt has an excellent beginner’s tutorial on their website that describes how to create and use encrypted container files. They also have a guide to setting Truecrypt up in traveler mode.

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