A self‐consistent electromagnetic theory is presented, for arbitrary &bgr;, of the flute‐interchange mode of a hot‐electron plasma where the hot‐electron guiding‐center drift frequency may be comparable to or larger than the ion‐cyclotron frequency. In the presence of bad curvature, an interchange instability exists at small and large precessional frequency, and this instability is stabilized by cold electrons. Electromagnetic theory introduces finite‐&bgr; corrections that only modify the results of a simple electrostatic theory that includes only the external drifts.