After installing the GMs to Sierra and Friends I was eager to try out the Auto Unlock feature with the Watch as passwords generally suck and re-entering them time and again sucks more.
With all my devices on the same Apple ID and updated, I went to the Security prefs on the Mac and lo … no option for it. After reading around I learned all the devices must be marked as Trusted in iCloud, which means you need Two-Factor Authentication (not Two-Step). I set this up and re-added each device to iCloud until they were marked appropriately. Still no option on the Mac.
Then I read around a little and discovered the requirements for this feature, which I couldn't find on Apple's site anywhere. While early release notes to the betas said any 2013 Mac would work, it turns out that only mid-year and later models will work — specifically those with the 802.11ac network card.
I ain't upgrading for this. Luckily, other folks have some solutions for this that work with less-stringent requirements on how recently your Apple tithe was paid, such as Knock and MacID.