ProGuard obfuscates and shrinks .apk files, providing some added protection for your app, but you may encounter some problems using it right now, at least with ADT 9 preview 3.

By default ADT creates a proguard.cfg file with every new project, so if you have an existing project just copy it over from a new dummy project. The next step is to enable ProGuard, you do this by adding the following to your default.properties file:

proguard.config=proguard.cfg

(assuming proguard.cfg is the ProGuard configuration file created for you, or copied from a new project, into the project root folder.)

When you export an APK release ADT will now run ProGuard on the code, however if like me you have any spaces in your project folder path it will fail. So for now please avoid any spaces in both your project folder path, and the Android SDK path. I believe Google are looking to resolve this in an update.

If you are using something like remote-stack-trace to receive crash reports you will need to follow the instructions on the Android site for automatically mapping the obfuscated code to make it human readable again.