What is API authentication?

Authentication helps ensure that authorized users can access the resources they need while protecting sensitive data and maintaining API security.

Application programming interfaces (APIs) are key pillars of modern IT ecosystems, enabling applications, databases, devices and other IT components to exchange data across architectures, environments and protocols. APIs are now the primary way that organizations integrate services and automate workflows, with 82% of enterprises adopting at least some degree of an API-first strategy, according to Postman. But organizations often struggle to maintain security and visibility over these complex connections.

While API-based IT ecosystems help enterprises improve agility, scalability and efficiency, they can also expose organizations to cyberattacks, data breaches and other security vulnerabilities. Robust API authentication, alongside other identity and access management (IAM) techniques, can help organizations benefit from integration while protecting against security threats.

API authentication is especially important for larger companies, whose enterprise application integration (EAI) platforms—which enable customer relationship management (CRM), enterprise resource planning (ERP) and other critical business systems to communicate despite architectural and data differences—can include hundreds or thousands of integration components and services. Enterprises with at least 10,000 employees now use on average 660 SaaS applications, according to a 2025 Zylo study. 

With services scattered across on-premises, hybrid and multi-cloud environments, many enterprises are turning to advanced authentication methods, such as tokens, passkeys, adaptive multi-factor authentication (MFA) and other encryption-based techniques. These approaches can offer multiple layers of protection and a deeper level of control compared to traditional techniques.

Authentication can be used to help secure many types of API-based interactions, including communications between microservices, data exchanges through an API gateway, and single-sign-on (SSO) and MFA for enterprise applications.

Roughly 99% of organizations report encountering API security issues, with authentication problems accounting for 29% of incidents, according to Salt Lab’s 2025 State of API Security report. Security challenges can arise due to poor least privilege practices, unsecured secret storage and uneven session management (when session revocations, expirations and refreshes are distributed inconsistently across an organization), among other issues.

Organizations can strengthen their API authentication systems by implementing token and privileged access management, maintaining centralized oversight and by using only trusted, well-maintained software libraries, alongside other best practices.

Both authentication and authorization are key parts of an organization’s IAM strategy, but they serve distinct roles. API authentication verifies a user’s identity through user credentials, access tokens and other cryptographic techniques.

API authorization, meanwhile, determines whether a user or service has permission to make a particular API request. For example, an internal IT team leader might be granted access to a wider range of services compared to a third-party contractor or an AI-powered agent assigned to a specific task.

One way to think about the difference between authentication and authorization: when a user enters a password into a login page, this process is a simple form of authentication. Authorization is what determines which services the user has access to after they are logged in. In many configurations, authentication happens first, with authorization servers returning an access token only after verifying the client or user’s identity.

API authentication works differently depending on which framework an organization uses. Some approaches are ideal for managing internal API access, such as in service mesh configurations, while others are better suited for external-facing API systems.

Organizations might consider their current infrastructure, compliance requirements and developer needs, among other factors like future configurations, when determining which authentication framework to adopt. Many enterprises use a combination of authentication techniques to accommodate different use cases. Common authentication mechanisms include:

Introduced and formalized in the 1990s, basic authentication is a relatively straightforward authentication approach that verifies user identity by using HTTP as a transport mechanism.

It works like this: first, the client provides a username and password in the authorization header of an HTTP request. These credentials are encoded with the Base64 scheme so that they can be properly transported (command line tools, such as cURL, HTTPie or Aria2, are often used to automate this process).

Next, the API server decodes the HTTP header and checks it against a list of approved credentials, which are typically stored as hashed values. If there’s a match, the server grants access to the protected endpoint or fulfills the API request. 

Because Base64 does not offer security, basic authentication relies on transport layer security (TLS)—specifically, the HTTPS protocol—to encrypt API calls. A more advanced variant called mutual TLS (mTLS) requires that both the client and the server exchange credentials. 

Still, in basic authentication, API security is limited because passwords do not automatically expire or refresh, and credentials must be resent for every API request, increasing exposure risks. If a password is compromised, developers must revoke it manually. Finally, basic authentication features limited built-in monitoring and access controls.

Despite its limitations, basic authentication is often used in testing and development environments and can be sufficient for low-sensitivity internal deployments when used over HTTPS. Basic auth is widely supported, simple to setup and fully stateless, meaning IT teams do not have to manage token storage or server-side sessions.

API key frameworks use API keys—strings of randomly generated characters assigned by the API provider—instead of relying on user-managed usernames and passwords. These unique identifiers typically correspond with a particular application or project, giving organizations fine-grained access control over individual services. For example, a team can apply rate limits to a particular client application or limit the client’s access to certain endpoints or production environments.

Like basic authentication, API keys are often included in the request header of an API call, although they can also be embedded in query strings or cookies. API key authentication is also stateless; an API key must be added to every API request because the server doesn’t store per-request session state.

In larger systems, API key management can become difficult, with IT teams struggling to keep up with key assignments. For example, if a key becomes compromised, the API provider can identify only the problematic key (which might be shared among several users), making it difficult to isolate the source of the breach. Troubleshooting can also prove challenging for shared projects, as revoking an API key affects everyone who uses it.

Because the API provider manages each API key, the provider can easily track usage and discard keys to revoke access if it detects a cybersecurity threat or a breach of API guidelines. The provider can also apply fine-grained permissions to precisely control each key’s scope. In basic auth frameworks, meanwhile, users create their own passwords, and API providers have limited ability to monitor and manage them. Finally, organizations can apply rate limits to particular projects, improving performance across services.

API key authentication is often best for public API environments because it enables service providers to monitor the developers who use their APIs. For example, for a restaurant to add a Google Maps integration to its website, it needs an API key.

This arrangement enables Google to track the restaurant’s usage and charge it for access to premium services. Google Maps isn’t especially concerned with hiding its proprietary data—the data is already publicly available—it just wants a way to track who is using it so that it can meter them appropriately, a task that API key authentication can help achieve.

Emerging in the early 2000s, security assertion markup language (SAML) is an open, XML-based authentication framework that enables single sign-on (SSO), or the ability to use one set of login credentials across multiple applications. An organization might implement SSO so that employees can access HR, payroll and email with a single login.

In basic auth and API key auth, the client sends credentials directly to the API. SAML introduces an additional step; it uses a third-party intermediary called an identity provider (IdP) to authenticate users. 

In SAML frameworks, a user who wants to access a particular service is routed to a trusted IdP, such as Google, Auth0 or OneLogin, which manages authentications on behalf of the service provider (the owner of the service a client wants to access). Both the service provider and the IdP can exchange a metadata document containing entity IDs (unique URIs) to distinguish themselves from other servers in the network and to establish trust. 

The client submits credentials, which the IdP then uses to verify the end user’s identity. Next, the IdP issues a security token called a SAML assertion—a signed XML document that might include log-in time, title, employee ID and other relevant user data—to prove that the user has been authenticated and to provide context around the user’s request. The service provider receives the assertion, then uses it to determine which level of access to grant the user. 

The process can be repeated across multiple services; if the IdP maintains its session with the user, it can respond to a second or third service with the same SAML assertion, vouching that the user has already been authenticated. This step enables the user to access connected services without having to sign in again.

SAML’s browser-based redirect flows work well for web applications but often lead to a poor user experience in mobile applications (OAuth 2.0 with OIDC is often preferred for mobile apps). The XML markup language is also more verbose than JSON and other counterparts. However, performance impact is generally negligible in authentication scenarios. Finally, the user attributes embedded in SAML assertions are not standardized and require custom mappings across systems.

However, SAML provides security benefits, such as consistent logging and auditing, through centralized authentication management (through the IdP). It also reduces the burden on API servers, as they no longer need to support authentication handling. Finally, SAML is widely supported, highly reliable and well-suited for B2B use cases.

OpenID Connect (OIDC) is a modern authentication protocol that, like SAML, achieves federated authentication through SSO. However, OIDC is optimized for mobile, API-driven and cloud-native applications and is different from SAML in several ways.

The initial steps are similar: a user tries to access a service, is redirected from the application to an identity provider (IdP) to authenticate and then back to the application with a token that proves their identity. 

However, instead of XML-based assertions, OIDC uses JSON Web Tokens (JWTs) for ID tokens, formatted as “header.payload.signature,” to represent authentication information. Like assertions, these messages confirm to a service provider that the client has been authenticated. Because JWTs use JSON and are more compact that XML-based assertions, they are generally a better fit for modern mobile apps, RESTful APIs and cloud-native web applications.

So SAML and OIDC use different identifiers and different concepts to achieve the same result: where SAML uses entity IDs and XML-based assertions, OIDC uses JSON/HTTP-based issuer URLs, client ID strings and JWTs, making OIDC a better fit for RESTful APIs and microservices architectures.

OIDC is an identity layer that sits on top of an authorization framework called OAuth 2.0 (sometimes referred to as OAuth2). OAuth 2.0 enables a client application to obtain scoped, time limited access tokens to call on protected APIs and access-restricted resources on behalf of a user (whether human or agent). OIDC adds identity verification to OAuth’s authorization functions by defining an ID token and related endpoints that verify who is attempting to access the resources.

For example, a development team might use a continuous integration and continuous delivery (CI/CD) platform to automate its GitHub deployments. With OAuth 2.0, the dev team can give the CI/CD service permission to access relevant GitHub projects on its behalf. The team can also specify which GitHub repositories it wants to share and which ones it wants to keep private.

There are scenarios where a client might seek authorization without first performing user authentication, such as with many machine-to-machine data exchanges. For example, an agent that sends daily logs to a centralized monitoring platform can safely carry out this task without knowing which user initiated this automation.

But in cases where the client needs to not only access a third-party server but also verify a user’s identity—for example, if the client needs to present secure information to the user—OAuth 2.0 by itself is insufficient. OAuth 2.0 defines only authorization standards and roles and cannot provide authentication. To fill this gap, OIDC acts as an optional extension of OAuth 2.0, defining ID tokens and standardized user information endpoints, so that clients can securely verify user identity during data-sensitive operations.

Together, OAuth 2.0 and OIDC can improve the user experience while helping keep API systems secure. When an employee logs in to an HR platform, for instance, they might be redirected to a centralized, OIDC-enabled login portal, which acts as the authentication layer, verifying to the HR platform that the employee is who they claim to be.

After the user logs in, OAuth 2.0 enables the HR platform to receive access tokens that authorize it to call secure APIs on behalf of the user. These APIs can then gather relevant employee records (such as the employee’s ID, title and start date) so that the employee does not have to repeatedly enter this data manually.

OIDC might be overly complex for internal deployments, requiring development expertise and extensive maintenance, especially in highly regulated industries, where complex compliance and governance standards complicate deployments.

However, for many organizations, OAuth 2.0 and OIDC offer a desirable balance between robust security and streamlined user experience. Access tokens are typically valid for only a few minutes, lowering security risks. At the same time, securely stored refresh tokens enable users to stay logged in for weeks or months without interruption.

Also, OIDC tokens are self-contained and lightweight, making them well suited for authenticating machine-to-machine interactions, as well as cloud and mobile implementations. 

We’ve already discussed JWT in the context of OIDC, but the open standard also has broader use outside of SSO implementations. While not an authentication framework on its own, JWT can be applied to custom authentication approaches, such as microservices authentication, Internet of Things (IoT) and API gateway authentication. 

JWT transmissions typically contain three elements:

• The header describes the type of token (in this case, JWT) and its signing algorithm.
  
  
• The payload provides claims, or details about the request, including who made it and the scope of their permissions.
  
  
• The signature uses a cryptographic key to prove that the header and payload haven’t been interfered with.

Although the token exchange process works similarly across use cases, the issuing party can change depending on the organization’s API architecture. Organizations can use an IdP, an authorization server, cloud services or custom backend services for authentication.

For example, in API gateway authorization, an authorization server might verify a client’s identity upstream, then deliver a signed JWT to the client. When the client sends an API request to the API gateway, the client will bundle its signed token alongside the request.

Because the API gateway trusts the issuing authority (in this case, the authorization server), it can read the token and forward the request to relevant backend services. The token contains proof that a particular client has been authenticated, so it can be preserved client-side and reused across different microservices, applications and architectural layers within a pre-defined lifetime. 

JWTs are highly compact, self-contained and interoperable, making them a natural fit for modern distributed systems. However, the use of JWTs can come with some notable downsides. First, revoking tokens before expiration is difficult without sacrificing their stateless nature, requiring relatively short-lived sessions to limit security vulnerabilities. Also, teams might overload payloads with too much information, slowing down authentication processes. Finally, custom JWT authentication processes don’t benefit from the standardization and interoperability inherent to OIDC and other alternatives.

Regardless of the specific approaches an organization uses, there are some shared best practices that can help mitigate common authentication challenges. Common strategies include:

Giving too much access to too many users can expose organizations to unnecessary risk. Without strict distribution of responsibilities and proper oversight, a user might unintentionally introduce misalignments into the authentication pipeline. 

The principle of least privilege can help address this problem. The concept asserts that users should be authorized to use only the services that are needed for their work, based on their role, location, time of access and other factors. 

Authentication systems can implement just-in-time provisioning so that access to a service is revoked immediately after a user completes their task. Teams can also set up separate administrator accounts and use them exclusively for making high-level changes to authentication policies and infrastructure. Frequent audits and monitoring can also help limit security vulnerabilities. 

Without encryption, it is easier for attackers to steal user credentials or tokens to gain access to sensitive materials. Organizations can use cryptographic protocols like TLS (most often through HTTPS) to protect authentication-based transactions. TLS can be supplemented with other encryption measures, such as mTLS, which requires both the client and server to be authenticated (also called bidirectional authentication).

In OIDC frameworks, JSON web encryption (JWE) can provide an additional layer of security during access token transactions. Finally, hashing algorithms (a fundamental security practice) can conceal credentials to maintain safe storage.

Short-lived tokens, which are rotated soon after issuance (typically within minutes or hours), can limit attackers’ ability to intercept them. This process is often automated so that IT teams do not have to manually track and revoke tokens. 

A similar approach can be applied to traditionally long-lived credentials, such as passwords and API keys. For example, organizations might implement a single-use, one-time password to supplement an employee login. With this strategy, attackers are prevented from accessing sensitive materials, even if they obtain an employee’s long-term username and password. Meanwhile, organizations can assign API keys to specific IP addresses or networks (such as a company-managed VPN), further limiting access to trusted clients.

While authentication workflows might be distributed across the organization, IT security teams can standardize and maintain API key and token storage, governance and oversight through a centralized secret management platform. A centralized control plane helps ensure the consistent implementation of authentication protocols across teams, departments and credential lifecycles.

Many authentication methods, including JWTs, API keys and basic authentication are natively stateless (the client sends authorization tokens or credentials with every API request), enabling APIs to fulfill requests without having to reference an external session.

Because the API call is self-contained, new services can be added without disrupting authentication workflows, improving scalability. Meanwhile, authentication can be carried out a single time, with credentials or tokens applied to multiple API calls, which benefits system efficiency and performance. 

Traditionally, APIs facilitated human-initiated interactions with services and applications. But as automation and agentic capabilities become an increasingly critical part of modern workflows, organizations are rethinking their authentication mechanisms to better accommodate non-human users. 

Nonhuman identities (NHIs) can include containers, IoT devices, servers, applications and AI agents. Modern authentication platforms often assign unique digital certificates to each NHI so that they can be monitored and protected. This security measure is important, considering there are on average 92 NHIs for every human in the modern enterprise, according to a 2025 Entro Labs study.

NHI authentication presents distinct challenges, especially because bots cannot perform MFA or enter passwords. In OAuth 2.0 frameworks, NHIs instead receive access tokens, which they can then use to call relevant APIs autonomously. 

Cloud platforms, meanwhile, often reference their own built-in identity services to authenticate NHI workloads dynamically, instead of referring to a third-party IdP. AI agents further complicate authentication because they can carry out complex, multi-step tasks across environments. Because these agents can operate without human intervention, authentication helps prevent them from unintentionally leaking sensitive information or creating misalignments. 

Different authentication methods work better with different types of agentic systems. For example, model context protocol (MCP) servers, which help LLMs communicate with external services, can use various authentication methods, including OAuth 2.0 and API keys, depending on what the external service requires. mTLS, meanwhile, might be better suited for zero trust settings. For example, teams can use mTLS-based authentication to restrict an agent from live deployments, while giving it access to secure testing environments.