The purpose of this thesis is to suggest and implement a new system that improves the security of the telephone network. The idea of the system is based on securing the 32-channel PCM frame by applying a new algorithm; This algorithm based on randomization of the time slots location within the frame at the transmitter. This randomized frame is transmitted via the transmission channel. At the receiver the same system is used to re-order the time slots in their original locations. This method is used to prevent the intruder from eavesdropping the time slot content by accessing the frame. The 32-channel PCM frame was chosen after a survey on telephone network security which includes the threats related to this network and the existing solutions. The survey shows that most telephone network security solutions based on securing single user channel; while the multi-channel levels were still vulnerable. After the survey; a suggested system was demonstrated and implemented. The new security system design includes other supported features which serve both in operation and installation. These features include automated software installations, error detection, handshaking algorithms, code generation and selection and so on. The suggested security system was operated with a simple PCM system with a phone call established between the two ends. A device called PCM analyzer was attached in the middle of the transmission link. This device could (in normal circumstances) display the content of anychannel within the multiplexed frame. When the suggested security system turned on; the PCM analyzer failed to display a meaningful data; which suppose to be the voice onversation. Mean while; the phone conversation between the two entities are normally continued. The output of the PCM analyzer was repeated streams of noise, which suppose to be a mixture of the randomly-ordered time slots content. Thus; the frame was secured against this access using the suggested security system.