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I have an external (non-system) drive with whole disk Truecrypt encryption.

When I mount the NTFS volume there is no option to compress contents in the drive->properties. And truecrypt mounted volumes don't show up in computer management->local storage.

Individual files and folders have the 'compress contents' box but it is disabled.

Is there any reason why you can't compress inside a truecrypt volume?

(Windows7, truecrypt 7.1, running as Admin)

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Encrypted data doesn't compress well, if at all, anyway. This is due to well-encrypted data being indistinguishable from random data while compression works by finding patterns in the data; the two are mutually exclusive if done properly. – Andrew Lambert Feb 6 '12 at 18:38
    
The compression is INSIDE the encrypted container. It will compress identically to any other data, the compressed (ie. essentially random) data is then encrypted – Martin Beckett Feb 6 '12 at 18:54
    
@Amazed: Compression should happen before anything is written to the disk, so this doesn't have an impact on encryption when writing at all. – Baarn Feb 6 '12 at 18:56

Fixed: NTFS encryption only works if you select default cluster size (4Kb)

I am using the device to store a few very large data dumps so had selected 64K

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