You may not be aware that when you delete a file, the file is not completely erased—you are merely eliminating the reference to that file. The contents of the file will remain on your hard drive until they’re overwritten by other data. These deleted files can be retrieved by simple utilities or by those who know where and how to look. In the case that you’re trying to delete a file containing sensitive information, you should use shredding software to prevent anyone from retrieving it. Before selling or donating old computers, you should make sure that sensitive data is removed. Files that are simply "dragged to the trash" can be easily recovered, so use a secure delete utility (such as those included with PGP and Norton Utilities) to wipe all hard drives in the system. It is best to set for multiple wipes, at least three passes.
Here are some free shredding software downloads that you can use to truly erase files from your hard drive. They both work by overwriting data one or more times before deleting the file.