The invention discloses an establishing and operation method for a portable smart password management system. The operation steps comprise 1, registering a system account; 2, generating digital certificate information; 3, transmitting the digital certificate information; 4, generating a master password and inputting user personal information; 5, carrying out secret sharing on the user master password; 6, storing password information in a database; 7, verifying integrity of database information; 8, logging in the system account at a network terminal; 9, recovering the password information from the database; 10, synchronizing the password information to the network terminal; 11, finishing automatic login operation by the network terminal; 12, authorizing other users, thereby enabling the other users to use the password information; 13, inputting the personal information to initiate password finding operation; 14, judging a user identity and recovering the user master password; and 15, modifying a social relationship attribute. According to the method, the password management efficiency is clearly improved, the convenient degree of using the password by the user is increased, the security of the password is improved, and the method has popularization prospect.