Well it sort of depends on your needs...
The best/easiest way is to use zip folders - a standard and much-maligned feature in WinXP.
"Zip folders" is a way to create and to use Zip files as if they were system folders from Windows Explorer. Un-aided, WinXP doesn't seem to provide a way to password files in a zip folder. It
does however prompt you for the password when opening or extracting a file.
If you want to use zip folders to protect files on your WinXP machine you will need a 3rd party zip utility that supports adding files with a password. There are lots out there, but if you need cheap (free) there is always FreeByte Zip.
Many will pooh-pooh zip passwords as being easily cracked. Well first of all you may not need
super security anyway. But secondly, passworded zip files
can indeed be created with reasonable security. The main thing is to use strong passwords (longer than 7 chars, avoid dictionary words) and
avoid storing Office documents and such in passworded zip files.
I found a lot on this on the web a while back. For secure passworded zip files the basic rules are:
* Long non-dictionary passwords
* Do not store file types that have common constant headers like Word documents (there is a "known-plaintext vulnerability" where if the 1st 80 bytes or so can be guessed the password can easily be cracked).
* Never use WinZip (there is a problem with many Zip files made using WinZip that leaves info behind in the file making it easy to crack).
To open a zip folder in Windows Explorer right-click it and select
Explore.
Look at it like this: it is easy and it costs you nothing to try. No NTFS required.