We've been discussing several solutions for the Single Signon problem in Drupal, and got to the conclusion that this is a really confusing topic and that there are several projects trying to achieve this goal in multiple ways, some of them work, some of them not quite.
It all started with Aegir and Bakery, both are incompatible and the Bakery maintainers said Bakery will never support Aegir. It seems that the only solution was LDAP or OpenID. While LDAP could work, it is definetely not an easy option for most users, OpenID would be easier. We've been having a discussion at http://groups.drupal.org/node/140874 where we've decided to move to D.o a working solution developed by DevSeed at github. This solution, although it works, it needs work, love and lots of documentation since there are some confusing names here.
I will probably be leading the project but I will need co-maintainers. If anyone wants to jump in and help, please post it here.

Comments
Cosign
When I needed single sign-on, I've used Cosign. But that was at a site which was already using ldap.
Why not build on the same
Why not build on the same base as Twitter Connect and Facebook Connect? Build it upon OAuth? That's the direction that OpenID is headed anyway.
There's a very simple module for exposing the needed OAuth API: http://drupal.org/project/oauthloginprovider
There's a not as easy (more flexibility needed) client for it as well: http://drupal.org/project/oauthconnector
I would be interested in helping out moving d.o to an OAuth based solution.
I found this link yesterday
I found this link yesterday and figured i would post it here even though i haven't digested it's contents fully or caught up with the conversation referenced above on Groups.Drupal
http://beeznest.wordpress.com/2010/11/22/drupal-6-bi-directional-user-sy...
// Paul Booker