Mod_auth_kerb is an Apache module designed to provide Kerberos authentication to the Apache web server. Using the Basic Auth mechanism, it retrieves a username/password pair from the browser and checks them against a Kerberos server as set up by your particular organization. The module also supports the Negotiate authentication method, which performs full Kerberos authentication based on ticket exchanges, and does not require users to insert their passwords to the browser. In order to use the Negotiate method you need a browser supporting it (currently standard IE6.0 or Mozilla with the negotiateauth extension).
The module supports both kerberos4 and kerberos5 protocols for password verification. The Negotiate mechanism can be only used with Kerberos v5. The module supports both 1.x and 2.x versions of Apache.
If you are using the Basic Auth mechanism, the module does not do any special encryption of any sort. The passing of the username and password is done with the same Base64 encoding that Basic Auth uses. This can easily be converted to plain text. To counter this, I would suggest also using mod_ssl or Apache-SSL. The use of SSL encryption is also recommended if you are using the Negotiate method.