Basic authentication requires users to enter a username and password to access your web server or web site. Basic authentication is the default setting and in order to use it, you must create and store a list of users and groups in an LDAP database, such as the Sun Java System Directory Server, or in a file. You must use a directory server installed on a different server root than your web server, or a directory server installed on a remote machine.
When users attempt to access a resource that has User-Group authentication in the Administration Server or on your web site, the web browser displays a dialog box asking the user to enter a username and password. The server receives this information encrypted or unencrypted, depending on whether encryption is turned on for your server.
Using Basic Authentication without SSL encryption, sends the username and password in un-encrypted text across the network and means that the network packets could be intercepted, and the username and password can be pirated. Basic authentication is most effective when combined with SSL encryption, Host-IP authentication, or both. Using Digest Authentication avoids this problem.