In this paper we shall show how we can find a linear system equivalent to a running key generator consisting of a maximum length (ML), a linear feedback shift register (LFSR), and a nonlinear feedforward state filter function. At the same time, a new analysis, which uses a Walsh orthogonal expansion of the state filter function and its relation to the crosscorrelation function (CCF) between the ML‐sequence and the produced running key sequence, is introduced.