In a preferred embodiment a method of operating an intelligent disk drive is described which includes compression and/or encryption capability at the file level. The intelligent disk drive includes means for executing distributed computing tasks including a CPU and associated memory. The communication interface with the host computer or other device on the communication bus is modified to allow the device to send executable code for a task to the drive and to allow the drive to communicate the results and status information about the task to the host device. In a preferred embodiment the disk drive has a task control program, task program code, task data and status information for the distributed task. The task control program implements the basic task management functions of storing the task program, reporting results and saving progress information to allow the task to be interrupted by other drive functions.