  Quantum key distribution (QKD) allows two users to communicate with
theoretically provable secrecy by encoding information on photonic qubits.
Current encoders are complex, however, which reduces their appeal for practical
use and introduces potential vulnerabilities to quantum attacks.
Distributed-phase-reference (DPR) systems were introduced as a simpler
alternative, but have not yet been proven practically secure against all
classes of attack. Here we demonstrate the first DPR QKD system with
information-theoretic security. Using a novel light source, where the coherence
between pulses can be controlled on a pulse-by-pulse basis, we implement a
secure DPR system based on the differential quadrature phase shift protocol.
The system is modulator-free, does not require active stabilization or a
complex receiver, and also offers megabit per second key rates, almost three
times higher than the standard Bennett-Brassard 1984 (BB84) protocol. This
enhanced performance and security highlights the potential for DPR protocols to
be adopted for real-world applications.
