The LocalSystem Account

The LocalSystem account is a predefined local account used by system processes. The name of the account is .\System. This account does not have a password. If you specify the LocalSystem account in a call to the CreateService function, any password information you supply is ignored.

A service that runs in the context of the LocalSystem account inherits the security context of the SCM. It is not associated with any logged-on user account and does not have credentials (domain name, user name, and password) to be used for verification. This has several implications: