Advanced Encryption Standard (AES), a Federal Information Processing Standard (FIPS), is anapproved cryptographic algorithm that is used to protect electronic data. The AES can be programmed insoftware or built with hardware. The paper presents a hardware implementation of the AES algorithm onFPGA. The algorithm was implemented in FPGA using Spartan 3E starter kit and Xilinx ISE developmentsuite. The purpose of this attempt was to test the correctness of the implemented algorithm and to gainexperience in optimization of algorithm structure for the embedded implementation in the target application.