In vCenter Server versions 5.1 and later, users authenticate through vCenter Single Sign-On.
In vCenter Server versions earlier than vCenter Server 5.1, when a user connects to vCenter Server, vCenter Server authenticates the user by validating the user against an Active Directory domain or the list of local operating system users.
The user administrator@your_domain_name has vCenter Single Sign-On administrator privileges by default. When logged in to the vCenter Single Sign-On server from the vSphere Web Client, the administrator@your_domain_name user can assign vCenter Single Sign-On administrator privileges to other users. These users might be different from the users that administer vCenter Server.
Users can log in to vCenter Server with the vSphere Web Client. Users authenticate to vCenter Single Sign-On. Users can view all the vCenter Server instances that the user has permissions on. After users connect to vCenter Server, no further authentication is required. The actions users can perform on objects depend on the user's vCenter Server permissions on those objects.
For more information about vCenter Single Sign-On, see vSphere Security.