Nowadays, security plays an important role in Internet of Things (IoT) environment especially in medical services' domains like disease prediction and medical data storage. In healthcare sector, huge volumes of data are generated on a daily basis, owing to the involvement of advanced health care devices. In general terms, health care images are highly sensitive to alterations due to which any modifications in its content can result in faulty diagnosis. At the same time, it is also significant to maintain the delicate contents of health care images during reconstruction stage. Therefore, an encryption system is required in order to raise the privacy and security of healthcare data by not leaking any sensitive data. The current study introduces Improved Multileader Optimization with Shadow Image Encryption for Medical Image Security (IMLOSIE-MIS) technique for IoT environment. The aim of the proposed IMLOSIE-MIS model is to accomplish security by generating shadows and encrypting them effectively. To do so, the presented IMLOSIE-MIS model initially generates a set of shadows for every input medical image. Besides, shadow image encryption process takes place with the help of Multileader Optimization (MLO) with Homomorphic Encryption (IMLO-HE) technique, where the optimal keys are generated with the help of MLO algorithm. On the receiver side, decryption process is initially carried out and shadow image reconstruction process is conducted. The experimentation analysis was carried out on medical images and the results inferred that the proposed IMLOSIE-MIS model is an excellent performer compared to other models.