The cloud paradigm, based on the idea of delegating to the network any kind of computational resources, is showing a considerable success. The estimated trend is that the number of different cloud-based solutions, approaches, and service providers (CSP) will continue growing. Despite the big number of different cloud solutions that currently exist, most of them are "walled gardens" unable to interoperate. On the other side, a large effort is taking place in the cloud community to develop and identify open solutions and standards. In such a context the concept of cloud federation, an architecture that combines the functionalities of different CSP, is a hot topic. This chapter presents an overview of the cloud federation topic, with special focus on its most important security challenges. Furthermore, it proposes a taxonomy of possible approaches to federation. Then it proposes a comparison of security problems in cloud and grid environment, and a detailed analysis of two relevant security problems, identity management and Cyber Attacks analysis, trying to outline how they can be applied in a federated context. © 2012, IGI Global.