TrueCrypt is a fully open-source tool for encrypting data. That data can be on a completely encrypted hard drive, or just an encrypted image file. Thankfully, the encryption works the same regardless of your platform, so Windows and OS X users can share encrypted files between computers.

We really like to use TrueCrypt in combination with Dropbox, another cross-platform tool, to protect our data in the cloud. Pictured here is the OS X version of TrueCrypt, mounting an encrypted image as a local hard drive. Whether you are storing sensitive data or Grandma's secret recipe, TrueCrypt can keep your data private, even if it's stored on someone else's server.

For more information and downloadable binaries for Windows and OS X, visit http://www.truecrypt.org.