How can protect all privacy from someone that needs to use my Mac?

A friend of mine is going to stay here for two days, and I am sure he will need to ask me to use the Mac (and PC) in the study room. (which will be tons of work to move them and no matter where they are moved, the friend for sure will ask for use of a computer).

In such case, what is the best way to protect my privacy, so that he won't be able to look at my Documents folder, Photos folder, etc, and all of my Firefox, Chrome, Safari's History, Bookmarks, and Stored Passwords?

I can create a temporary account, I think, and log in using that tmp account, but will that protect looking at my default user folders on hard disk, and also, the Safari / Firefox / Chrome etc were installed so that they can be used by all users, so do I also need to remove all those History, Bookmarks, Stored Passwords, on each browser? (and it is not good to remove the bookmarks and stored passwords because I may need them later).

Is there a better way?

I enable the Guest Account in System Preferences, then go to the login screen when someone else wants to use the computer. That way they get a totally clean user with none of my personal settings, and anything they do is wiped from the system when they log out. It's super handy.

Just make sure your admin account has a good password that isn't written down anywhere (or add some numbers you will remember to your usual password.)

From there, you can make a guest account for them - as long as it isn't an admin user - they can't grant themselves access to your files.

If anything is truly sensitive - don't let them near the mac. It's easy to boot any mac from an install disk and access your files since my operating system won't care what your password was. Your guests would only need time, a little knowledge and curiosity (or worse) to have access to anything that isn't otherwise encrypted on your Mac. You can (should?) make encrypted disk images to store any sensitive information that you wish to protect from someone that would access your mac against your wishes.

See this article for an explanation. Even if you store your password in your keychain (less secure) - a technician can't see the contents of the folder unless they crack your password (or your keychain/log in password). It will just be scrambled bits.

If you want really 99.999% security, the only way is to encrypt your data. (Because in the worst case, it's possible to open your Mac, take off the HDD, and read it in another computer).

To enable encryption, you can use FileVault:

System Preferences > Security > FileVault

See: Use FileVault to encrypt the startup disk on your Mac

Ps: Honestly, I never tried it. Maybe someone can post more about it.

If you enable Open Firmware in addition to using the Guest account option, you basically you would need to start disassembling the Mac to get at the information.

bmike is correct in saying with an install disk or single user mode you can reset the password, but if you have a Guest account with Open Firmware you are going to be pretty safe. BE CAREFUL HOWEVER: Apple does not support Open Firmware and it can be a pain if you forget the password.

From Apple's article:

Features of Open Firmware Password Protection Intel-based Mac computers

• Blocks the ability to use the "C" key to start up from an optical disc.
• Blocks the ability to use the "D" key to start up from the Diagnostic volume of the Install DVD.
• Blocks the ability to use the "N" key to start up from a NetBoot server. Blocks the ability to use the "T" key to start up in Target Disk Mode (on computers that offer this feature).
• Blocks the ability to start up in Verbose mode by pressing the Command-V key combination during startup.
• Block the ability to start up a system in Single-user mode by pressing the Command-S key combination during startup.
• Blocks a reset of Parameter RAM (PRAM) by pressing the Command-Option-P-R key combination during startup.
• Requires the password to enter commands after starting up in Open Firmware, which is done by pressing the Command-Option-O-F key combination during startup.
• Blocks the ability to start up in Safe Boot mode by pressing the Shift key during startup. Requires the password to use the Startup Manager, accessed by pressing the Option key during startup