Use OpenID - it is Convenient and Safe!
OpenID lets you safely sign in to different websites with a single password.
For details please see this Wikipedia article or the OpenID project homepage.
Using OpenID is generally free. All you need to do is register with one or multiple OpenID providers that you trust. (Just because some asked that question: Most people in our team use VeriSign, typically among other OpenID providers.)
The OpenID TYPO3 Plugin
Do you want to use OpenID on your TYPO3 web site? The extension needed is called naw_openid (also by naw.info) and is of course available in the TYPO3 extension repository.
Q: With TYPO3, how does OpenID relate to DirectSSO?
A: They perfectly co-exist. OpenID lets the users logon to your TYPO3 portal, while DirectSSO lets them seamlessly go to other applications from your TYPO3 portal.