The Password Protection plugin provides a way to safeguard sensitive notes in Obsidian by restricting access with a password. It allows users to lock either the entire vault or specific subfolders, prompting for a password when accessing protected notes. Once authenticated, users can access other protected notes without re-entering the password until they choose to lock the vault again. Additional features include an auto-lock function that re-enables password protection after a set period and an option to prevent closing the password prompt without correct entry. The plugin does not encrypt or modify files, ensuring notes remain unchanged while adding a layer of on-screen privacy.