The characteristics of vehicular communication environments and their networking and application requirements have led to the development of unique networking protocols. They enable vehicle-to-vehicle and vehicle-to-infrastructure communication based on IEEE 802.11 technology, ad hoc principles, and wireless multi-hop techniques using geographical positions. These protocols, commonly referred to as Geocast, greatly support the vehicular communication and applications, but necessitate a tailored security solution that provides the required security level with reasonable processing and protocol overhead as well as reasonably priced on-board and road-side unit equipment. In this paper we present the design of a security solution for Geocast, based on cryptographic protection, plausibility checks using secure neighbor discovery and mobility-related checks, trustworthy neighborhood assessment, and rate limitation. We analyze the achieved security level of the proposed scheme and assess its overhead and performance. Further, we develop a software-based prototype implementation of a secure vehicular communication system. We find that the proposed security measures could result in a network performance bottleneck in realistic vehicular scenarios. ... mehrFinally, we analyze the tradeoff between security overhead and protocol performance, and determine the minimal processing overhead needed for acceptable performance.