Credential isolation means giving each agent, service, or workflow its own narrowly scoped identity and permissions instead of sharing broad, reusable access. The goal is simple: if one component is tricked, compromised, or misconfigured, it cannot automatically act everywhere else.
In cyber security, this limits blast radius and makes abuse easier to detect. It matters especially for AI agents, automation scripts, and API-driven systems that can browse, call tools, or modify data. Attackers often try to escalate from a small foothold to higher-value accounts; isolated credentials make that much harder. Defenders use separate API keys, short-lived tokens, least-privilege roles, and per-task accounts so sensitive actions require explicit authorization and are easier to log, revoke, and audit.