In a recent post about encrypting your hard drive I suggested that using the encryption software could help in the situation where you are either selling or giving your computer away. Before you give that hard drive inside your computer away you should make sure to fully erase it. There is just too much personal data that ends up on a computer that would be terrible to have exposed to the public, which is essentially what you are doing if you give anyone else your computer.
Besides using TruCrypt in order to achieve this effect (with quite a bit of work), there is another open source (free) utility that can do this. It is called Dark's Boot and Nuke and it can be downloaded from here.
This utility is enterprise and even government strength. After using it the little data areas of the hard drive called sectors are written with random data, wiping out the personal data you had there before. After using this utility you can then format the drive and install a fresh copy of Windows (or use the Restore CD that the computer manufacturer sent you) so that the computer is ready for use.
Please remember to apply all of the Windows security patches since the copy of Windows you install is likely to be a few years old and without the patches the user of your computer would be a sitting duck out there.