I am the only user on my MBP, and normally I am the only person who ever uses my laptop.
However, I am doing some research, and the data I have contains very personal information about a number of people. I need to make sure I can keep anyone out of the folder until I manually erase the personal data from every spreadsheet (they're hundreds of em).
How can I do this?
Straight from the Leopards Disk utility help:
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Creating a blank disk image for storage
You can use Disk Utility to create a blank disk image to store files. Normally, you need to gather all the files you want to be included into a single location before you create a disk image. However, with a blank disk image, you can add files to the image at any time.
To create a blank disk image:
Choose File > New > Blank Disk Image.
Type a name for the disk image, and choose where you want to save it from the pop-up menu.
In Volume name, enter the name for the volume that appears on your desktop when you double-click the disk image.
Choose the size of the disk image from the Volume Size pop-up menu.
To require a password to open the disk image, choose an encryption scheme from Encryption.
Choose “Single partition - Apple Partition Map” from the Partitions pop-up menu.
Choose “sparse bundle disk image” from the Image Format pop-up menu.
Click Create.
To add files to the disk image, open the image in the Finder to create a volume on your desktop, and then drag files to that volume.
Some info about "Sparse Disk Image's" (copied from another forum):
A sparse disk image is an automatically expanding disk image. In other words, you can create a 50 gigabyte sparse disk image, yet only put 5 megs inside it. The disk image will only take up five megs of space on your harddisk, but will be capable of storing up to 50 gigs of data should you choose to add it. Note that it auto-expands but does not auto-contract. In other words, if you delete files from the image, you will not regain any free space on your harddisk (although you will on the image). Disk Utility can be used to "shrink" a sparse image, reclaiming any unused space on the image.
A sparse bundle is essentially the same thing, the only difference is that while a sparse image is one giant file on your disk, a sparse bundle is actually lots of small files (8 megabytes each). They work and look the same way, but you can right-click on a sparse bundle, select "show package contents" and see the individual 8 meg "bands".
The sparse bundle was introduced with OS 10.5 in order better support Time Machine (Especially with FileVault, where the entire home directory is a sparse bundle). Previously, a backup programme would see the image as one file, and if any changes had to been made to it, it would have to recopy the entire image. With sparse bundle, it can only copy the bands that have been changed since the last backup, so the backups are much quicker. It also is likely to decrease the chance of data loss, as you could conceivably restore parts of a damaged image.
Basically, if you want a sparse image, use the sparse bundle under 10.5. Only use the sparse image if you need backwards-compatibility with earlier versions of the Mac OS.