How to Password protect your external hard disk drive..

Several external hard drives integrate hardware password-protected encryption. If yours is an open drive, you can use a software encryption program to prevent unauthorized users from accessing your data. If you have Windows 7 Ultimate or Enterprise edition, you can do it with the help of preinstalled utility called BitLocker Drive Encryption. Other Windows 7 editions must rely on third-party software, such as the free and open-source TrueCrypt program. Such open-source programs may seem less secure, because the source
code and encryption algorithm are available for deconstruction, but in fact their security is strengthened by having thousands of programmers thoroughly test the code and identify potential weaknesses.

Method 1 : BitLocker
Steps:
Attach your external hard drive to your Windows 7 Ultimate or Enterprise computer and power on the drive.
Click "Start | Control Panel | Security | BitLocker Drive Encryption" to open the BitLocker program.
Click "Turn On BitLocker" next to your listed external hard drive.
Check "Use a Password to Unlock the Drive" and enter a password in the "Type Your Password" and "Retype Your Password" fields, making sure the password is the same in both fields. Click "Next."
Click "Save the Recovery Key to a File," choose a save location on your main hard drive and click "Save." Alternatively, insert a USB flash drive in your USB port, click "Save the Recovery Key to a USB Flash Drive" and click "Save." Either option creates a recovery key, so you can decrypt the drive if you forget your password. Click "Next."
Click "Start Encrypting" to encrypt the drive and require a password for subsequent access. The encryption process can take several minutes --or even hours-- to complete, depending on the size of your drive and your processing power.

Method 2 : TrueCrypt
Steps:
Attach your external hard drive and install the TrueCrypt program.
Click the "Create Volume" button in TrueCrypt.
Click "Encrypt a Non-System Partition/Drive" and then "Next." Click "Yes" if you receive a security warning; you may also need to enter the administrator password.
Click "Standard TrueCrypt Volume" and then "Next."
Click "Select Device," choose the external hard drive's partition from the list and click "OK." If the external hard drive contains multiple partitions, you have to encrypt them separately. Click "Next."
Click "Encrypt Partition in Place" if the external hard drive already contains data. If it is empty, choose "Create Encrypted Volume and Format It," which offers faster encryption. Click "Next."
Click "Next" two more times to accept the default AES encryption method
Enter a long and complex password in the "Password" and "Confirm" fields, making sure the passwords match in box fields. Click "Next."
Click "Yes" if you plan to store files larger than 4GB on the drive, or "No" if you do not foresee this need. Click "Next."
Move your mouse randomly for several seconds to strengthen the encryption key and click "Format."
Mount the drive within TrueCrypt to access it.
Click "Select Drive," an available drive letter and then "Mount," and enter your password. The drive is then accessible via Windows Explorer like any other drive.

Method 3 : StorageCrypt
Steps:

Download and install StorageCrypt.
Plug your USB device and run StorageCrypt.
Now select your device from Choose Disk Drive Section
Select Quick encryption under Encryption Mode (Quick Mode is faster, but Deep encryption mode provides higher security.)
Select Full option under  Portable Use section.
Enter your password two times and hit the Encrypt button to lock your drive. A bleep sound confirms the operation.
Your USB drive is now encrypted and locked by password. The contents of the drive are inaccessible unless it is unlocked again.

Unlock drive using StorageCrypt

Plug in and open your encrypted drive. You will be having a file called SClite.exe inside a folder named SClite. Run the SClite.exe file.
Note: In case you don’t find the SClite folder, directly run StorageCrypt from your local system.
Provide the password and click on Decrypt to unlock your drive.
Once you’re done, close the previously opened SClite window and run SClite.exe file again. This time you’ll get the option to lock the drive. StorageCrypt is a Shareware with a 7 day trial period. If you want to continue after the trial, you need to purchase a lifetime license.

Method 4 : USB Copy Protection
Steps:

Download and install USB Copy Protection.
Plug in the USB drive and launch the software.
The USB drive should be listed in the Select Drives tab. If it doesn't show up, click the Refresh button on the right side.
Now select the particular USB drive you want to protect using USB Copy Protection.
Now click on the Permissions tab. Here you can define different access levels for different users. The different access levels which may be assigned are Read, Write, Full or Custom. Additionally, you may also set the password for different users.
If Custom access is selected, you can explicitly define user access permissions for the particular user.
Now, proceed to the Options tab to configure the encryption strength and the Client name and title.
Finally click on the Encrypt Now tab, type the Administrator password twice and click on Protect.
Your drive is now protected with the configured access permissions. If you open the drive in Windows Explorer, only the USB Copy Protection Client file will be available. Run the client by double clicking on the file.
Now login with valid user credentials.
If the password is correct, the user will be granted access according to the access levels configured specifically for them.

How to remove USB Copy Protection client from USB drive
If you wish to remove the USB Copy Protection client from your drive, run the client and login with admin account. Now click on the Manage option in the File menu and select Complete Unprotect. You may be asked to enter the Administrator password.

Warnings: If you forget your password and do not have a recovery key, you will be unable to access your external hard drive and its data. So, be sure to write down the password in a secure location.