By default, Microsoft Office SharePoint Server 2007 provides the Microsoft Single Sign-On (SSO) service for storage and mapping of credentials for use in connecting with third-party or back-end systems. Many companies already have developed an in-house credential storage system or use a solution other than the Microsoft Single Sign-On service. As an alternative to maintaining credential mapping in two places, Office SharePoint Server 2007 provides a mechanism called pluggable SSO. This feature allows you to specify an alternate SSO provider to the standard SSO provider in Office SharePoint Server 2007.
Great MSDN article here http://msdn2.microsoft.com/en-us/library/ms566925.aspx