In OAuth authentication, the website or app will send you to Twitter where you sign yourself in, then Twitter will tell the website or app “Yeah, they are who they say they are.” The website or app only gains the ability to do certain things with your account — post, read, reply, search — while staying locked out from the more sensitive stuff.
The biggest advantage of OAuth is you don’t have to tell your Twitter password to anyone other than Twitter. Also, OAuth connections are token-based, so once a connection is established, you can change your Twitter password without having to re-enter it into the website or app.
The only disadvantage is that old apps that haven’t updated to use OAuth will stop working this week. All of the popular ones (Seesmic, Tweetdeck, etc.) have already updated.
Apparently this changeover was initially scheduled to occur earlier this year. But it was delayed because of the volume of Tweets linked to some recent global football event.
It’s a much better system of authentication, and I’ve been using it for my apps for a while now (albeit in XAuth form). Have you brought yours up to date?