StegFS is a Steganographic File System for Linux. Not only does it encrypt data, it also hides it such that it cannot be proved to be there.
The source code is now available here. It is released under the GNU GPL.
The current StegFS release is version 1.1.4 (devel).
Note that this is still 'under development'. It is not bug-free yet. There may be possibly serious problems. In short, if it destroys your computer or your data or causes a minor nuclear holocaust don't blame me. There is a known file corruption bug. See the BUGS file for details.
StegFS only works on 2.2.x kernels.
Feel free to try it, but don't get too upset if you have problems. There are still bugs/misfeatures that want fixing. However, it should be stable enough for use.
It is strongly recommended that you read "StegFS: A Steganographic File System for Linux" before attempting to use this file system. You should also read the README file and the FAQ.
Please note that StegFS releases are signed with this PGP key. (Note: This key has now been revoked since I have not produced any new releases for a number years, and do not expect to do so.)
Although a number of people have shown some interest in recent times in doing work on StegFS or developments of the idea no-one seems to have had enough energy to actually do anything. However, I understand that the "hidden volume" capabilities of TrueCrypt do something similar.
Some code and information:
Last substantive modification 2004-07-11, with minor edits
2008-03-29 and 2011-06-01