Abstract The healthcare industries frequently handle sensitive and proprietary data, and due to strict
privacy regulations, they are often reluctant to share data directly. In today’s context, Federated
Learning (FL) stands out as a crucial remedy, facilitating the rapid advancement of distributed machine
learning while effectively managing critical concerns regarding data privacy and governance.
The fusion of federated learning and quantum computing represents a groundbreaking interdisciplinary
approach with immense potential to revolutionize various industries, from healthcare to
finance. In this work, we propose a federated learning framework based on quantum tensor networks
that takes advantage of the principles of many-body quantum physics. Currently, there are
no known classical tensor networks implemented in federated settings. Furthermore, we investigated
the effectiveness and feasibility of the proposed framework by conducting a differential privacy analysis
to ensure the security of sensitive data across healthcare institutions. Experiments on popular
medical image datasets show that the federated quantum tensor network model achieved a mean
receiver-operator characteristic area under the curve (ROC-AUC) of 91-98%, outperforming several
state-of-the-art federated learning methods while using fewer parameters. Experimental results
demonstrate that the quantum federated global model, consisting of highly entangled tensor network
structures, showed better generalization and robustness and achieved higher testing accuracy,
surpassing the performance of locally trained clients under unbalanced data distributions among
healthcare institutions.