Simplest approach is to pop up a custom dialog to capture the user name and password in the dialog's input fields. Theres an option for an input field that will replace the user's input with bullets (black dots).
If you don't use show custom dialog, you'll need to write a script performed by the OnKeystroke Trigger to take each typed in character and store it in a hidden field, putting a place holding bullet or asterisk in the data field. This script would need to be sophisticated enough to respond correctly to editing keystrokes such as the backspace as well as the tab, enter and return keystrokes that might exit the field.
Any other workaround? Custom dialog doesnt support IWP....
Really appreciate if you have any workaround for hiding the password in layout in IWP.