This paper introduces a permutation generation mechanism based on a shared secret key. The generated permutation vectors are used as encryption keys in a stream ciphering cryptosystem. We investigated various types of attacks on the known stream cipher RC4 and patched most of its loopholes, especially biased-byte and state-related attacks. Unique to our approach, we prove mathematically that the complexity of brute-forcing such a system is (2n), where n is the key size in bytes. This paper also presents a complete security model using permutation-based encryption, in order to handle privacy. In addition, our approach achieved higher performance than that of existing peer techniques, while maintaining solid security. Experimental results show that our system is much faster than the existing security mechanisms, such as AES and DES.