KittyMohawk shared this with us in microsoft.public.word.docmanagement:
I too am trying to find information about protecting not just files,
but folders in words. I tried following the trail in the thread but
found it didn't get me anywhere and didn't give me the answer I was
looking for. I tried contacting Microsoft but they would not help
and told me to contact Dell directly, something I prefer not to do.
This is NOT a question about Word but a question about Windows.
However I am in a good mood today so exceptionally I will help you.
The drive on which you have your files has to be formatted in NTFS.
Don't use FAT! If it's on a file server, it is probably already NTFS,
but it could also be Novell or Samba or NFS or something else and more
exotic. Anyway that is outside the scope of the argument so I won't go
into the details.
If this conditions is met, you can set permissions on files and folders
using Windows Explorer. You don't need Word for that. Right click on a
folder, choose Properties, and read what the screen says.
HTH, HAND