A beam‐plasma type ion source employing an original operating principle has been developed by the present authors. The ion source consists of an ion extraction region with an electron gun, a thin long drift tube as the plasma production chamber, and a primary electron beam collector. An electron beam is effectively utilized for the dual purpose of high density plasma production as a result of beam‐plasma discharge, and high current ion beam extraction with ion space‐charge compensation. A high density plasma of the order of 1011–1013cm−3was produced by virtue of the beam‐plasma discharge which was caused by the interaction between a space‐charge wave on the electron beam and a high frequency plasma wave. The plasma density then produced was 102–103times the density produced only by collisional ionization by the electron beam. In order to obtain a stable beam‐plasma discharge, a secondary electron beam emitted from the electron collector should be utilized. The mechanism of the beam‐plasma discharge was analyzed by use of a linear theory in the case of the small thermal energy of the electron beam, and by use of a quasilinear theory in the case of the large thermal energy. High current ion beams of more than 0.1 A were extracted even at a low extraction voltage of 1–5 kV.