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is there a way to do this?


There's one way, it involves the widget 'Abracadabra' ' http://www.interdimensionmedia.com/widgets/widgetframe.html#abracadabra' . It involves dragging whatever you want to password protect into the hat on the dashboard, and it'll hide it in there for you. It hides the files as well, but you can retrieve them from the hat whenever you want. You can password protect it as well.
 
Don't know why you would want to password protect a folder in OS X since you can use fast user switching or just turn on the screensaver and use the security pane to make password required to wake from screensaver.
 
Don't know why you would want to password protect a folder in OS X since you can use fast user switching or just turn on the screensaver and use the security pane to make password required to wake from screensaver.

That is very weak protection. Others users with Administrator privileges can read all of your files. Anybody with physical access to your computer or hard disk can read the files on it without too much difficulty.
 
another note on the Disk Image...
if you set it to be a "Sparse" Disk Image it won't consume any hard drive space until you add folders and the like. but you still have to set a size restriction on it when creating it.
 
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