In this paper we study the threshold behavior of the fixed radius random graph model and its applications to the key management problem of sensor networks and, generally, for mobile ad-hoc networks. We show that this random graph model can realistically model the placement of nodes within a certain region and their interaction/sensing capabilities (i.e. transmission range, light sensing sensitivity etc.). We also show that this model can be used to define key sets for the network nodes that satisfy a number of good properties, allowing to set up secure communication with each other depending on randomly created sets of keys related to their current location. Our work hopes to inaugurate a study of key management schemes whose properties are related to properties of an appropriate random graph model and, thus, use the rich theory developed in the random graph literature in order to transfer ?good? properties of the graph model to the key sets of the nodes. Partially supported by the IST Programme of the European Union under contact number IST-2005-15964 (AEOLUS) and the INTAS Programme under contract with Ref. No 04-77-7173 (Data Flow Systems: Algorithms and Complexity (DFS-AC)).