Abstract: A method and apparatus for authenticating electronic transactions carried out over public networks such as the Internet is disclosed. A transaction record which identifies the electronic transaction to one party, typically a merchant or institution is created. The transaction record is encrypted by a computer controlled by the merchant or institution so as to allow later decryption by the merchant or institution and to prevent alteration by others. A digital receipt is formed by appending the encrypted transaction record to a plaintext message describing the transaction in plaintext. The digital receipt is then communicated to a computer controlled by the customer. The formation of the digital receipt may take place real-time, so that the second party's computer process may remain inactive until the digital receipt is received.