Disk encryption software
Disk encryption generally refers to wholesale encryption that operates on an entire volume mostly transparently to the user, the system, and applications. This is generally distinguished from file-level encryption that operates by user invocation on a single file or group of files, and which requires the user to decide which specific files should be encrypted. Disk encryption usually includes all aspects of the disk, including directories, so that an adversary cannot determine content, name or size of any file. It is well suited to portable devices such as laptop computers and thumb drives which are particularly susceptible to being lost or stolen. If used properly, someone finding a lost device cannot penetrate actual data, or even know what files might be present.
Cryptography
Until modern times, cryptography referred almost exclusively to "encryption", which is the process of converting ordinary information (called plaintext) into unintelligible form (called ciphertext). Decryption is the reverse, in other words, moving from the unintelligible ciphertext back to plaintext. A "cipher" (or "cypher") is a pair of algorithms that create the encryption and the reversing decryption. The detailed operation of a cipher is controlled both by the algorithm and in each instance by a "key". The key is a secret (ideally known only to the communicants), usually a short string of characters, which is needed to decrypt the ciphertext. Formally, a "cryptosystem" is the ordered list of elements of finite possible plaintexts, finite possible cyphertexts, finite possible keys, and the encryption and decryption algorithms which correspond to each key. Keys are important both formally and in actual practice, as ciphers without variable keys can be trivially broken with only the knowledge of the cipher used and are therefore useless (or even counter-productive) for most purposes.