With the aim of tackling insufficient security in the chaotic encryption algorithm for digital images in the Optical Access Network, a color image encryption scheme combining non-degenerate discrete hyperchaotic system and deoxyribonucleic acid (DNA) dynamic encoding is proposed. First, a new non-degenerate hyperchaotic system is constructed with all positive Lyapunov and more complex dynamic characteristics. Furthermore, the key sequence based on non-degenerate hyperchaotic system is generated using plaintext correlation to achieve the effect of a dynamic secret key. Next, a binary bit-planes permutation is performed on the image using one of the key sequences. Then, the chaotic key sequence is used to sequentially perform DNA encoding, obfuscation, and decoding. Finally, a binary bit-planes obfuscation is performed to obtain the final ciphertext. The research results show that the non-degenerate chaotic sequence can pass the NIST 800-22 test, and the corresponding encryption algorithm can resist various common attacks and has a strong anti-interference ability. In addition, the algorithm is verified on ARM-Embedded, which proves that the encryption system proposed in this paper is a feasible secure communication technology scheme. Therefore, the scheme proposed in this paper is helpful to provide new ideas for the design and application of high-security cryptosystem in optical access network.