Google's tracking of your browsing habits is pernicious and insidious. Through its Google Analytics (a system used by web site owners to record statistics) and Google AdSense (the Google text ad system), Google has code on millions of web sites, and uses this code to follow your activity. Not only does Google know what you do on their own sites, but by using these other tools - Google Analytics, for example, is provided for free so Google can amass data - the company keeps track of which sites you visit and when.
A new, free Safari extension called Incognito, by Orbicule, hides your activity from Google tracking. It can block Google AdSense and Google Analytics from recording your activity, and can also block the display of embedded YouTube movies (also owned by Google), and Facebook links as well.
For those using Firefox, a similar tool called Google Sharing, allows users to anonymize their activity on Google sites.
In either case, given that Google is collecting so much information, it can be a good idea to ensure that this information does not include anything about your activities.