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Security has become a prime concern in providing communication between mobile nodes in a hostile environment. Unlike wired networks, the unique characteristics of Mobile Ad Hoc networks (MANETs) pose a number of non-trivial challenges to security design. This paper presents a threshold security mechanism with an AntTree clustering algorithm. Nodes which have similar movement pattern are grouped into a cluster. Clustering requires flooding of control information to all the constituent nodes in the network. Flooding is expensive in terms of overhead. It also litters valuable resources such as bandwidth and power. An improvement to flooding is to select probabilistically, a subset of nodes to rebroadcast. To perform efficient clustering, we introduce a new signal strength based metric to estimate the distance between any two nodes in the mobile environment. We employ a threshold cryptographic scheme to protect routing information and data traffic. To ensure distributed trust in the clustered environment, we divide the private key (k) into n pieces in such a way that k is easily reconstructable from any t number of pieces. Even complete knowledge of (t-1) pieces reveal absolutely no information about k.