The ever-growing landscape of the Internet of Things (IoT) demands robust security solutions to safeguard communication and data integrity. This paper proposes a novel multi-level authentication scheme that leverages Encryption techniques and fuzzy logic to enhance security and mitigate Denial-of-Service (DoS) attacks in the IoT domain. The proposed scheme establishes mutual authentication between communicating entities, ensuring both user and device identities are verified. This two-way verification thwarts unauthorized access and impersonation attempts. Additionally, the scheme offers flexibility by incorporating multiple authentication levels. This adaptability caters to the diverse resource constraints and security requirements prevalent within the vast spectrum of IoT devices. Furthermore, the scheme integrates fuzzy logic to identify and potentially mitigate DoS attacks. By analyzing various parameters, including the frequency and origin of authentication requests, the fuzzy logic component can distinguish legitimate traffic from malicious attempts, potentially filtering out DoS attacks before they overwhelm the system. This multifaceted approach addresses critical security concerns in the IoT environment. The proposed scheme offers enhanced authentication, adaptability to diverse resource constraints, and the potential for DoS attack mitigation, contributing to a more secure and robust IoT ecosystem.