The low‐frequency interaction of a cross‐field current with a longitudinally magnetized inhomogeneous plasma has been studied. It is found experimentally that, in addition to the ion‐cyclotron harmonic instability, a very low‐frequency instability also develops in the range&ohgr;2≪ &ohgr;c i2, &ohgr;c ibeing the ion‐cyclotron frequency, and that at these large amplitudes nonlinear wave mixing takes place between them. Using a simple model, we show that the latter mode can be interpreted in terms of the cross‐field current‐driven modified ion‐cyclotron instability.