The existing privacy preserving clustering data mining algorithms cannot meet better trade-off between efficiency and privacy. To resolve this problem, a distributed privacy preserving clustering algorithm based on Secure Multi-party Computation (SMC) combined with perturbation was proposed. Data owners utilized the wavelet to achieve both data reduction and information hiding, and rearranged the attribute columns randomly to prevent data reconstruction which has potential danger of causing information disclosure. The proposed algorithm reduced computation and communication cost because it only used reduced data in its computation. Thus the efficiency of the algorithm was improved. At the same time, the incorporation of multiple protection measures in the computation effectively preserved data privacy. The clustering accuracy was less affected because of the high dependability of wavelet transform. The theoretical analysis and experimental results indicate that the proposed algorithm is secure and highly effective, and the overall F-measure and the efficiency of the proposed algorithm outperform the DCT-H (Discrete Cosine Transform-Haar) algorithm when dealing with high-dimensional datasets. Above all, it effectively resolves the trade-off issue between efficiency and privacy.