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Facial recognition technology is becoming increasingly ubiquitous nowadays. Facial recognition systems rely upon large amounts of facial image data. This raises serious privacy concerns since storing this facial data securely is challenging given the constant risk of data breaches or hacking. This paper proposes a privacy-preserving face recognition and verification system that works without compromising the user’s privacy. It utilizes sensor measurements captured by a lensless camera - FlatCam. These sensor measurements are visually unintelligible, preserving the user’s privacy. Our solution works without the knowledge of the camera sensor’s Point Spread Function and does not require image reconstruction at any stage. In order to perform face recognition without information on face images, we propose a Discrete Cosine Transform (DCT) domain sensor measurement learning scheme that can recognize faces without revealing face images. We compute a frequency domain representation by computing the DCT of the sensor measurement at multiple resolutions and then splitting the result into multiple subbands. The network trained using this DCT representation results in huge accuracy gains compared to the accuracy obtained after directly training with sensor measurement. In addition, we further enhance the security of the system by introducing pseudo-random noise at random DCT coefficient locations as a secret key in the proposed DCT representation. It is virtually impossible to recover the face images from the DCT representation without the knowledge of the camera parameters and the noise locations. We evaluated the proposed system on a real lensless camera dataset - the FlatCam Face dataset. Experimental results demonstrate the system is highly secure and can achieve a recognition accuracy of 93.97% while maintaining strong user privacy.