This tutorial is for an outdated version of Google Chrome. Please refer to the updated version (05/31/12)
By default, Chrome will sync the following items automatically: Apps, Autofill data, Bookmarks, Extensions, Omnibox History, Passwords, Preferences, and Themes. A more cautious user may not want everything synced, although the data is encrypted in multiple ways. This includes your saved passwords being encrypted on both your local device and Google’s servers utilizing a cryptographic key.
If you want to go ahead and sync all of the aforementioned items, click on the button labeled OK, sync everything. If you’d like to specify what gets synced and what stays local, click on the Advanced link.