A digital file is associated with a header in which identification data for a physical key is stored. The digital file content is encrypted, and may not be decrypted by a receiving computer unless a removable physical key that can be associated with the receiving computer includes identification data which matches the identification data stored in the file header. The digital content encrypted in the file may be compressed, and the header may also be encrypted. When the header is encrypted, the receiving computer may decrypt only the header unless the identification data of the header matches the identification data for a removable physical key. Improved security and reduction of pirating of the digital content are therefore provided.