Yes aluminum foil does block signals so by wrapping your key fob in aluminum foil you block signals that can be used by car thieves to steal your vehicle.
You can either use aluminum foil or tin foil to wrap your key fobs in and if you live in an area where cars are stolen a lot then it would be a good idea to wrap your key fob in aluminum foil or tin foil to block the signal and prevent car theft.
It can still be possible for a good car thief to steal your vehicle even when your cars key fob is wrapped in aluminum foil.
However it makes it much harder for thieves to steal your vehicle when the key fob is wrapped in aluminum foil or tin foil.