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Abstract. We describe an experimental laboratory system that generates and distributes random binary sequence bit streams between two optical terminals (labeled Alice and Bob). The random binary sequence is generated through probing the optical channel of a turbulent atmosphere between the two terminals with coincident laser beams. The two laser beams experience differential phase delays while propagating through the atmospheric optical channel. The differential phase delays are detected and sampled at each terminal to yield raw random bit streams. The random bit streams are processed to remove bit errors and, through privacy amplification, to yield a bit stream known only to Alice and Bob. The same chaotic physical mechanism that provides randomness also provides confidentiality. The laboratory system yielded secret key bit rates of a few bits∕second. For external optical channels over longer channel lengths with atmospheric turbulence levels, secret bit rates of 10 s of bits∕second are predicted.

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