Homomorphic encryption is a cryptographic scheme that allows computations to be performed directly on encrypted data without requiring prior decryption. The output remains encrypted, and when decrypted with the corresponding private key, it yields a result identical to performing the same operations on the original plaintext. This property mathematically guarantees that the processing party never accesses the raw data.
Glossary
Homomorphic Encryption

What is Homomorphic Encryption?
A cryptographic paradigm enabling computation on ciphertexts, generating an encrypted result that, when decrypted, matches the output of operations performed on the raw plaintext.
The scheme exists in three primary forms: partially homomorphic encryption (PHE), supporting only addition or multiplication; somewhat homomorphic encryption (SHE), allowing limited operations of both types; and fully homomorphic encryption (FHE), which enables arbitrary computation on ciphertexts. FHE remains computationally intensive due to noise management via bootstrapping, but it is the definitive solution for secure cloud processing and privacy-preserving machine learning inference.
Types of Homomorphic Encryption
Homomorphic encryption is not a single algorithm but a family of schemes offering different levels of computational capability on ciphertexts. The three primary classifications—Partially, Somewhat, and Fully Homomorphic Encryption—represent a trade-off between computational expressiveness and performance overhead.
Partially Homomorphic Encryption (PHE)
Schemes that support unlimited operations of a single type—either addition or multiplication, but not both. PHE is computationally lightweight and practical for specific, bounded use cases.
- RSA Encryption: Supports unlimited modular multiplication on ciphertexts, making it multiplicatively homomorphic.
- Paillier Cryptosystem: Supports unlimited addition of encrypted integers and multiplication by a plaintext constant.
- ElGamal Encryption: Supports multiplicative homomorphism over cyclic groups.
- Use Case: Secure e-voting where encrypted votes are tallied via addition without decrypting individual ballots.
- Performance: Negligible ciphertext expansion and fast execution compared to stronger schemes.
Somewhat Homomorphic Encryption (SHE)
Schemes that support both addition and multiplication but only for circuits of limited depth. Each operation introduces noise that grows until decryption becomes impossible.
- BGN Cryptosystem: Supports one multiplication followed by unlimited additions using bilinear pairings.
- YASHE & B/FV Schemes: Ring-LWE-based schemes that support deeper circuits before noise overwhelms the ciphertext.
- Noise Budget: A finite resource consumed by each operation; multiplication is exponentially more expensive than addition.
- Use Case: Computing simple statistical functions like averages and standard deviations on encrypted medical data.
- Bootstrapping Gap: SHE lacks the recursive self-correction mechanism needed to reset the noise budget.
Fully Homomorphic Encryption (FHE)
The holy grail of encrypted computation: schemes that support arbitrary computation on ciphertexts by evaluating circuits of unbounded depth. FHE achieves this through bootstrapping, a technique that homomorphically evaluates the decryption circuit itself to refresh the noise budget.
- Gentry's Blueprint (2009): The first theoretical construction using ideal lattices and a bootstrappable SHE scheme.
- TFHE (Fast Fully HE): Optimized for gate-level boolean circuits with sub-second bootstrapping, ideal for low-latency applications.
- CKKS Scheme: Supports approximate arithmetic on encrypted real numbers, enabling privacy-preserving machine learning inference.
- BGV/BFV Schemes: Integer arithmetic schemes optimized for SIMD-style batching of thousands of operations.
- Use Case: Training a logistic regression model on encrypted patient records in an untrusted cloud environment.
Leveled Fully Homomorphic Encryption
A practical variant of FHE that can evaluate circuits up to a pre-determined multiplicative depth without bootstrapping. By setting the parameters to support exactly the required depth, leveled FHE avoids the enormous computational cost of bootstrapping.
- Parameter Selection: The scheme's modulus chain is sized to accommodate the target circuit depth at setup time.
- Modulus Switching: A noise management technique that scales down ciphertext noise after each multiplication without bootstrapping.
- BGV & BFV in Practice: Most real-world deployments use these schemes in leveled mode for efficiency.
- Use Case: Privacy-preserving inference on a fixed-depth neural network where the architecture is known in advance.
- Limitation: Cannot handle data-dependent loops or recursion where the circuit depth is unknown at encryption time.
Threshold Homomorphic Encryption
A multi-party variant where the secret key is split among multiple parties, and decryption requires a threshold number of participants to collaborate. No single party can decrypt ciphertexts independently.
- Distributed Key Generation: The secret key is generated jointly without any party ever holding the complete key.
- Threshold Decryption Protocol: A minimum of t-out-of-n parties must contribute partial decryption shares to recover the plaintext.
- Use Case: A consortium of hospitals jointly computing on encrypted patient data where no single institution can unilaterally decrypt the results.
- Integration: Can be layered on top of BGV, BFV, or CKKS schemes.
- Security Model: Protects against a dishonest minority of colluding parties attempting to violate data privacy.
Hybrid Homomorphic Encryption (HHE)
A pragmatic architecture that combines symmetric encryption for data with homomorphic encryption for computation keys, enabling efficient processing of large datasets. The client encrypts data with a lightweight symmetric cipher and uses HE only to encrypt the symmetric key.
- PASERK & Transciphering: The symmetric ciphertext is transformed into an HE-compatible format on the server side.
- HERA & Rubato Ciphers: Low-multiplicative-depth symmetric ciphers specifically designed for efficient transciphering to FHE.
- Use Case: Encrypting a terabyte-scale genomic database with AES, then homomorphically computing on specific records by transciphering only the relevant blocks.
- Bandwidth Reduction: Dramatically reduces ciphertext expansion during client-to-server transmission.
- Trade-off: Introduces a transciphering step that adds latency but enables FHE on datasets too large for pure HE encryption.
Frequently Asked Questions
Clear, technical answers to the most common questions about performing computations on encrypted data without ever decrypting it.
Homomorphic encryption is a cryptographic scheme that allows computations to be performed directly on encrypted data without requiring decryption, producing an encrypted result that matches the output of operations on the plaintext. It works by mapping operations on plaintext to corresponding operations on ciphertext within a specific algebraic structure, typically using lattice-based cryptography built on the Ring Learning With Errors (RLWE) problem. When you encrypt a value x to E(x) and y to E(y), a homomorphic operation ⊕ satisfies E(x) ⊕ E(y) = E(x + y). This property enables a third party, such as a cloud server, to process sensitive data while it remains mathematically protected, returning only an encrypted result that the data owner can decrypt with their private key.
Enabling Efficiency, Speed & Accuracy
Intelligent Analysis, Decision & Execution
We build AI systems for teams that need search across company data, workflow automation across tools, or AI features inside products and internal software.
Talk to Us
Search across company data
Give teams answers from docs, tickets, runbooks, and product data with sources and permissions.
Useful when people spend too long searching or get different answers from different systems.

Automate internal workflows
Use AI to route work, draft outputs, trigger actions, and keep approvals and logs in place.
Useful when repetitive work moves across multiple tools and teams.

Add AI to products and internal tools
Build assistants, guided actions, or decision support into the software your team or customers already use.
Useful when AI needs to be part of the product, not a separate tool.
Related Terms
Homomorphic encryption is a foundational primitive within the broader landscape of privacy-enhancing technologies. The following concepts are essential for understanding its application, limitations, and complementary role in securing AI systems.

About the author
Prasad Kumkar
CEO & MD, Inference Systems
Prasad Kumkar is the CEO & MD of Inference Systems and writes about AI systems architecture, LLM infrastructure, model serving, evaluation, and production deployment. Over 5+ years, he has worked across computer vision models, L5 autonomous vehicle systems, and LLM research, with a focus on taking complex AI ideas into real-world engineering systems.
His work and writing cover AI systems, large language models, AI agents, multimodal systems, autonomous systems, inference optimization, RAG, evaluation, and production AI engineering.
Partnered with leading AI, data, and software stack.
How We Work
Custom AI workflows for your Business
One-fit-all AI don't work for modern businesses. At Inferensys, we aim to understand your business & custom requirements; which we use to define most efficient agentic workflows, the data, and the tools for your business.
01
Review the use case
We understand the task, the users, and where AI can actually help.
Read more02
Pick the right approach
We define what needs search, automation, or product integration.
Read more03
Build the first useful version
We implement the part that proves the value first.
Read more04
Improve from there
We add the checks and visibility needed to keep it useful.
Read moreThe first call is a practical review of your use case and the right next step.
Talk to Us