Adding a local user under Cygwin
Suppose we want to add Gromit [password: passw0rd] as a Cygwin user.
Issue the following commands on the console:
$ net user Gromit passw0rd /add /yes
$ mkpasswd -l -u Gromit >> /etc/passwd
The first line adds a new user under NT.
In the second line we're appending the user password to the existing list of passwords. Now, create a directory in
/home for the new user:
...and make Cygwin aware of the new user.
Note that the user won't be able to login until NT has a place to store his/her profile. For this, either login as that new user (on local machine), or issue a command to create a directory
<sysDir>\Documents and Settings\Gromit
...and we should be done!
Reference taken from here