File Sharing Problems

Can SharePoint Require Passwords for External File Sharing?

Huda Qurayshi Oct 9, 2026 868 views

Question details

The user wants to know if there is a native setting in SharePoint or OneDrive to force external users to create or use a password when accessing shared files.

How to Require Passwords for External File Sharing in SharePoint

Product: SharePoint Online
Device & OS: not provided
Scenario: Sharing confidential files or folders securely with external clients or partners.
Observed behavior: There is currently no out-of-the-box feature to force external users to set a permanent password for external sharing links.

Before you start

Before exploring secure sharing options, verify with your Microsoft 365 administrator which external sharing policies are currently enabled for your organization, as this limits what sharing link types you can generate.

Solution 1Recommended

Use 'Anyone with the Link' and Set a Custom Password

If your organization allows anonymous sharing links, you can manually set a password on the link itself before sending it to the external user.

While SharePoint does not force external users to create their own passwords, you can enforce password protection by generating an encrypted link. The recipient will be required to type the password you provide to access the file.

Select the file to share

Navigate to your SharePoint or OneDrive document library, select the file you want to share, and click the 'Share' icon.

Modify link settings

Click on the gear icon or the current link setting (e.g., 'People in your organization') to open the Link Settings menu.

Select 'Anyone with the link'

Choose the 'Anyone with the link' option. Note: If this is grayed out, your admin has disabled anonymous sharing.

Set a secure password

Under 'More settings', check the 'Set password' box, enter a strong password, and click 'Apply'. Share the link via email and provide the password to the recipient through a separate, secure channel.

Best Practice: Always communicate the password using a different medium (like an SMS or a phone call) than the one used to send the document link.

Solution 2

Rely on Email-based One-Time Passcode (OTP)

If password-protected links are disabled, use the 'Specific people' option which utilizes a secure One-Time Passcode sent to the user's email.

Solution 3

Submit a Feature Request to Microsoft

If the existing OTP or Anyone link options do not meet your compliance requirements, you can submit direct feedback for future product updates.

Free Microsoft Office alternative

Securely Share Files with Passwords using WPS Office

If you need an easier way to share documents securely without complex admin configurations, WPS Office offers a lightweight, highly compatible alternative to Microsoft Office. With the built-in WPS Cloud, you can effortlessly create password-protected sharing links for your documents, ensuring only authorized users can access your data.

1. Open your file in WPS Office: Launch WPS Office and open the document you wish to share securely.
2. Click on Share: Navigate to the top right corner and click the 'Share' button to generate a sharing link.
3. Set an access password: Choose the encrypted link option and set a custom password before sending the link to your external contacts.

Free and lightweight alternative to Microsoft Office.Fully compatible with Microsoft Word, Excel, and PowerPoint formats.Built-in WPS Cloud allows easy password protection for shared file links.Familiar user interface for seamless and quick migration.Cross-platform support for Windows, Mac, Linux, iOS, and Android.

Frequently Asked Questions

Why is the 'Set Password' option grayed out in my SharePoint share menu?

This happens when your Microsoft 365 tenant administrator has disabled 'Anyone with the link' (anonymous) sharing. The password option is only available for anonymous links. You will need to contact your IT admin to enable this feature.

Is the One-Time Passcode (OTP) secure enough for external clients?

Yes, Microsoft's OTP is a widely accepted security standard. It ensures that the person accessing the document has active access to the specified email inbox, replacing the need for them to memorize or create an additional password.

Can I force external users to log in with a Microsoft account instead?

If you share a file using the 'Specific people' setting, users with an existing Microsoft account or Microsoft 365 work account will be prompted to log in. Users without an account will default to the email OTP method.

Document & File Issues