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Short for Encrypting File System, part of the Microsoft NTFS file system. EFS is a transparent public key encryption technology that works in conjunction with NTFS permissions to grant and deny users access to files and folders in Windows NT (excluding NT4), 2000 and XP (excluding XP Home Edition) operating systems.
EFS uses a public key and a private key for encryption. If the user does not have one, the EFS generates the key pair automatically. Files can be encrypted individually, or a folder can be designated as encrypted, so that any file written to that folder is automatically encrypted. Because EFS's encryption technology integrates into the file system, users can't access the hard disk without going through the file system.
EFS is not available in Windows versions 95, 98 or Me as these operating systems use the FAT16 and FAT32 file systems.
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 eSecurity Planet 
A resource for daily information on e-security targeted to IT managers. The site provides users with information from a variety of sources, including experts at security product and services firms, and the consultants who follow the security industry.
Inside Encrypting File System
Learn about Win2K's built-in encryption facility from this article from Windows & .NET magazine.
Encrypting File System Primer: Basics and Best Practices
A 2001 article from the SANS Institute.
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