Security is a high priority issue in medical domain, because many institutions performing biomedical research work with sensitive medical data regularly. This issue becomes more complicated, when it is desirable or needed to access and analyze data in a multi-institutional setting. In the NCI cancer Biomedical Informatics Grid (caBIG) program, several security issues were raised that existing security technologies could not address. Considering caBIG is envisioned to span a large number of cancer centers and investigator laboratories, these issues pose considerable challenge. In this paper we present these issues and the infrastructure, referred to as GAARDS, which has been developed to address them.