Important: If you forget the password to your encrypted disk image, the data on that disk image cannot be recovered. It may be copied to or created on network volumes or removable media, including Zip drives, USB flash media, or FireWire hard drives. Each encrypted disk image is protected by a password. The following document explains how to create, mount, and unmount an encrypted disk image.
Encryption means it requires a password to open or become available (to 'mount'). An encrypted disk image acts as secure storage space and can be used like any other disk image file. The Disk Copy or Disk Utility feature for macOS can be used to create an encrypted disk image.