Today alistapart published an interesting article on password masking and whether or not it was time to give it up.
They also proposed an iPhone-like progressive masking behavior and wrote an example implementation in javascript.
I liked the idea and tried to come up with a way I could use this in my existing projects, which are usually built using jQuery. This is my quick and dirty take on it. It might also make a good plugin some day.
Use it in your own projects if you like it.
Sample Page using jQuery