The TM5800 chip will incorporate features such as passwords and keys to lock encrypted communications inside the processor.
Transmeta's approach contrasts with that of the Trusted Computing Platform Alliance, which includes chip giants Intel and AMD. The Alliance plans to incorporate security features into a processor separate from the main chip.
Transmeta believes putting security functions inside the main processor is safer than putting them in another chip.
The Transmeta processor will include a hardware acceleration engine to speed up processor-hungry actions when dealing with strong encryption technologies such as Triple DES, and it is aimed mainly at the notebook market.
Brian Gammage, an analyst at Gartner, expressed scepticism over how much interest the processor would generate among notebook computer makers. "Transmeta is well-established as a maker of low-power processors, but for the manufacturers of notebooks to take notice it needs to notch up some design wins. It is a niche player," he said.
The Trusted Computing Platform Alliance was started by IBM, Intel, Microsoft and HP. It has been developing operating system, hardware and Bios specifications to enhance security and privacy in PC architectures.
It aims to make storing confidential information on hard drives simpler, allow multiple identities for users and make it possible to check the integrity of software on a PC platform.