This paper deals with the algorithm analysis and implementation issue of the AES (Advanced Encryption Standard) used in the network security of modern communication systems, such as internet (intranet) and iTV systems. In detail, we use Matlab to simulate the Rijndael AES algorithm which has been selected to be the standard by NIST in the year 2002 among the five candidates and also perform the possible FPGA and hardware design analysis on implementation of a prototype AES chip.