[vibhavs]

I store sensitive data in Dropbox using an OS X encrypted disk image in my Dropbox directory. It's not an elegant solution, but it gets the job done. I mount the password-protected disk image when needed, access the data, and unmount when finished. Upon unmounting, Dropbox syncs the encrypted blocks to S3, other computers, etc.

(Encrypted disk-images can be fairly handy. I picked up the trick from a friend and colleague who used them to protect email and other sensitive documents on his laptop. E.g. he sym-linked Mail.app's mail directory, ~/Library/Mail, to the disk image.)

[sunchild]

Doesn't this prevent backup/syncing while the image is open?

[daydream]

Sure, but in practice for a single-user dropbox account it's not a big deal, IF you unmount the volume when you're done with it.

I do the same thing that the GP does - mount the disk image, work with the files, then unmount. It's been working great for me for a while, though as the GP says it's not very elegant.