A novel concatenated physical-layer encryption (CPLE) scheme is proposed in this study, where better security can be achieved as well as reliability advantage. In CPLE scheme, the encryption is embedded in rateless encoding. The secret key, which is generated from wireless channel, controls the random degree and random linear combination. The rateless codes are also concatenated with other conventional channel codes, which can achieve better reliability. Different from security codes, both the security and reliability in the proposed scheme can be improved. Furthermore, there is no extra computation requirement on decoding process. Security analysis is presented including time complexity comparison and attacks resistance in practical application. Compared to other PLE schemes, the proposed scheme achieves lower complexity, and higher channel adaptation and performance advantage. On the basis of National Institute of Standards and Technology statistical test suite, CPLE scheme can achieve randomness as the traditional cipher system such as advanced encryption standard. Furthermore, simulation results show that the CPLE scheme outperforms the conventional concatenated codes at the same coderate.