A number of third-party firms currently sell auto-save programs, but Mr Jobs said that just four percent of users used them.
Time Machine will let users retrieve old data, such as photos or documents, simply by moving a slider back in time within programs such as iPhoto.
A recent survey in the UK revealed that one-third of digital camera users are not backing up their photographs.
Mr Jobs also used the conference to unveil a replacement for the firm's high-end computer, the Power Mac.
A new machine called the Mac Pro and aimed at the professional end of the market is now on sale, offering dual core 2.66 Ghz CPUs.
A specific date for the launch of Leopard was not given but it is thought to be available in Spring next year.
