I found something on wikipedia

Security in pre-shared key mode

Pre-shared key mode (PSK, also known as personal mode) is designed for home and small office networks that don't require the complexity of an 802.1X authentication server. Each user must enter a passphrase to access the network. The passphrase may be from 8 to 63 printable ASCII characters or 64 hexadecimal digits (256 bits).[2] If you choose to use the ASCII characters, a hash function reduces it from 504 bits (63 characters * 8 bits/character) to 256 bits (using also the SSID). The passphrase may be stored on the user's computer at their discretion under most operating systems to avoid re-entry. The passphrase must remain stored in the Wi-Fi access point.

http://en.wikipedia.org/wiki/Wi-Fi_Protected_Access