System and method for software activation and further tracking of its states on an end-user computing device (computer) was developed to provide software developers a flexible and secure tool for software distribution and gathering statistics of usage of software activation. The method consists of the following logical steps: (a) obtaining an acquisition confirmation; (b) requesting for a license; (c) issuing and delivering the license to End User, the license being secured with a private key by a server, and the private key is not stored at the client; (d) verification of license on the User's computer; (e) storing the license on the User's computer; (f) periodic tracking of activation state, (g) another action with the User's license, wherein the verifying the license comprises validating, at the client associated with the application, the license received from the server without any modifications, and saving the license to the client.