Here is the simple code you should save in your .htaccess file to protect the current directory. The encrypted login names and passwords should be saved in users directory under public_html directory. (You can change the path if you have saved it somewhere else above the current directory)
You can not however save this users file in the current directory as it's not accessible unless you provide the correct password. The server can't check if the password is correct or not if the passwords are saved in the current directory that is again, protected!!

AuthType Basic
AuthName "By Invitation Only"
AuthUserFile /home/oksoft/public_html/users
require valid-user

The users file look something like this..
shantanuo:QckxMPdP51n66
(login:encrypted password)

Pass all files to PHP Processor
Another use of .htaccess file is to force all the files to be treated as PHP files. So that even if the file extension is .htm and you have the PHP code inside it, your server will still see it and process it.
The only line to be added in your .htaccess to process all the files under current directory to be treated as PHP..
ForceType application/x-httpd-php3

Following code will process the file soccer (without any extension) as PHP file..

ForceType application/x-httpd-php

Other access parameters:
To change the default page from index.html to whatever.html:
DirectoryIndex whatever.html

To make a directory not list certain files:
IndexIgnore *.gif *.jpg

To disallow Directory browsing all together:
Options -indexes

To show files in a slightly more beautiful fashion:
Options +Indexes
IndexOptions FancyIndexing

To redirect an old folder to a new one:
Redirect /oldfolder http://www.yoursite.com/newfolder/
To redirect an old file to a new file
Redirect /oldfile.ext http://www.yoursite.com/newfile.ext

To show your custom error pages, rather than the boring ones:
ErrorDocument Code /errorpage.html
e.g. ErrorDocument 500 /errors/500.html
Make sure to replace Code above with the appropriate error code.

301 (Moved Permanently)
304 (Not Modified)
403 (Forbidden)
404 (Not Found)
500 (Internal Server Error).

Upload the .htaccess to the htdocs folder.