The search giant's security bosses are set to publish their findings next month and say they could soon be commonplace.
The Yubikey, which is believed to have been tested by Google, can automatically log users onto all their accounts without ever asking for a password by placing it into a Google laptop.
The tiny key can be used in any machine with a USB drive, and acts as a physical "key" to unlock the user's account.
It can automatically log users in to all of their accounts, and even into their favourite websites, without ever asking for a password.
In the upcoming issue of IEEE Security and Privacy Magazine, Google Vice President of Security Eric Grosse and engineer Mayank Upadhyay are set to detail what is basically a physical key with a "smart chip" embedded inside it.
"Along with many in the industry, we feel passwords and simple bearer tokens such as cookies are no longer sufficient to keep users safe," the Daily Mail quoted the pair as writing in their paper, according to Wired.
The firm is also believed to be experimenting with wireless chips that are already built into some mobile phones, and can even be built in jewellery.
'We'd like your smartphone or smartcard-embedded finger ring to authorize a new computer via a tap on the computer, even in situations in which your phone might be without cellular connectivity,' the team write.
The firm is also believed to be addressing the obvious problem with the system - users losing their "key".
The firm is thought to be developing a simple system to replace them.
The USB Keys can be placed on a keychains, and are similar to the ID readers required by many banks to allow people to log into their accounts
However, the pair admits that they will have to rely on websites to support the scheme.
The USB keys are resilient to being dropped, and can even be taken underwater without ruining them.
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