Before you toss that old hard drive out stop. What information is on there? How about your personal information? Banking information? Maybe even some incriminating or embarrasing pictures, emails or documents?
Now that you are thinking about what may be contained on that drive, how hard would it be for someone else to pick it up and slap it in a machine and pull that information off? Not hard at all.
There are several ways to make sure that the data on the disk is not (easily) recovered. One way is physically destroy the device. One common practice for physical destruction is to drill the case, and straight through the platters (they may shatter and/or throw off shards so be sure to wear proper eye protection.)
Many stores offer to do this for you when you upgrade your hard drives. There is nothing wrong with letting the store do this for you, but make sure you watch every step of the process or you may end up surprised like the couple in Springfield Township, Ohio. They trusted their local Best Buy store when they were told that the drive would be destroyed, but got a phone call a year later from a gentleman in Chicago who told them that he had just bought their hard drive at a flea market, with all their data in tact.
If you are planning to pass your drive on rather than trashing it, however, there are a couple tools that may come in handy. One is Eraser by Sami Tolvanen. It can be used to overwrite files, directories, or entire drives with pseudo-random binary data. If you have more than one drive you want to wipe, however, it makes it difficult to use something like Eraser. In this case you can use Darik’s Boot and Nuke – you boot from the floppy or CD and it wipes the entire drive(s) installed in the machine.