A method for securely configuring a customer premise equipment in a network. The network including a configuration server, a DHCP server, and the customer premise equipment. The method includes receiving a request from the customer premise equipment for leasing an Internet Protocol (IP) address to the customer premise equipment. The method further includes embedding at least a portion of a Media Access Control (MAC) address of the customer premise equipment into the IP address leased to the customer premise equipment. The method includes leasing the IP address to the customer premise equipment. Further, the method enables authentication of customer premise equipment, before providing configuration to the customer premise equipment. The method includes use of characteristic attributes of the customer premise equipment to generate cryptographic keys for secure connection. Moreover, the method includes establishing a secure connection between the configuration server and the customer premise equipment for transfer of a configuration file and a set of encryption keys. The configuration file and the set of encryption keys are used to securely configure the customer premise equipment.