"(I'm) not totally clear why Yahoo would do this, other than CEO Marissa Mayer seems to believe Yahoo's products have improved enough that users will feel compelled to either create an account or even switch over entirely from Google and Facebook," said Dana Wollman, managing editor at Engadget.
This is the latest move by Mayer since she took the company's reins almost two years ago. She has made upgrades to Yahoo Mail and Yahoo Finance.
"I'm not especially confident this will help boost Yahoo's relevance; if anything, Yahoo's renewed focus on making its products better will have a bigger impact," said Wollman.
Yahoo may lose a few users in the meantime from the new sign-in process, but the information it gets from engaged users may make the new strategy worth it, Wollman said.
"They've already begun the hard work revamping these products, and changing the login structure seems like small beans if we're talking about how relevant Yahoo will be over the next five years," she said.
Disclosure: CNBC has a content-sharing partnership with Yahoo's finance site.
—By CNBC's Christina Medici Scolaro.