A type of chaotic encryption scheme by combining circular bit shift with XOR operations was proposed in 2006 based on iterating chaotic maps. Soon after the proposal, it was cryptanalyzed and improved. Unfortunately, there are still two drawbacks in the two improved schemes. To strengthen the performance of the focused type of scheme, a new improved scheme based on Chen's chaotic system is proposed in this Letter. Simulation results and theoretical analysis show that our improved scheme is immune to information extracting by chosen plaintext attack and has expected cryptographic properties.