A new method of password encryption uses an image to encrypt a longer piece of data. Using a short key, the process of generating the image from the original image is reversed. The longer piece of data can then be read off from the image. Since computers have a harder time in telling they have found something that makes sense, this is more secure than just using a text. The reversed image may not be identical to the original image because the system is chaotic. A small error in an image can lead to completely missing the correct image.
http://plus.maths.org/content/captcha-chaos
Paper (unpublished in peer reviewed journal)
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