The two‐plasmon instability in warm inhomogeneous plasma for a normally incident pump is considered. The complex eigenfrequencies of the absolute instability are obtained by reducing the linearized fluid equations to a Schro¨dinger equation in wavenumber space. These eigenvalues are obtained in several ways. One is by combining a perturbation expansion in powers of the reciprocal scale length with WKB theory. The resulting algebraic equations are solved by three analytical approximations and by direct numerical solution. A second way is by analysis of the Schro¨dinger equation using an interactive WKB computer code. A third way is by the use of a shooting code. These methods are all used and compared for threshold curves and growth rates above threshold. Some eigenfunction forms are also obtained. The threshold is near (v0/ve)2k0 L=3, and varies weakly with &bgr;&bartil;v4e/v20c2, rising from near 2 to about 4 over six decades of variation of &bgr;. The corresponding critical value of (ky/k0)2is near 0.2/&bgr; over this range. Above threshold, there is a smooth variation of the growth rate with (ky/k0)2, peaking at some intermediate value. The perturbation method is in good agreement there with more exact calculations. Experimental implications of these results are discussed.