ATM Forum specifies public key cryptography to be the default ATM authentication mechanism and directory services like X.509 to be the infrastructure for public key distribution and certification. Authenticated signaling, widely acknowledged as a necessary security feature of ATM network, requires the signaling message to be authenticated with a digital signature signed by the private key of the calling party. To verify the digital signature, the called party needs to obtain the public key of the calling party and a proof of the calling party's ownership to that public key. In X.509, the standard form of such a proof is a chain of public key certificates, called the certificate path between two parties. Certificate exchange protocol (CEP), proposed by ATM Forum, requires that another bi-directional connection be established between two parties to exchange public keys and certificate paths before an authenticated connection can be set up, which is not an ideal approach. We propose an algorithm which is embedded into ATM routing protocols to generate a certificate path inside a signaling message on-the-fly as the signaling message travels through the ATM network. In this approach, all that a calling party needs to know for authentication purpose is its own public key certificate and the ATM network builds the rest of the certificate path for it. Related issues like distribution of public key certificates and optimization of CA hierarchy are also addressed in this paper.