Quasi‐monochromatic waves at ∼1.2 ƒcH, where ƒcH is the hydrogen cyclotron frequency, were observed as the ISEE 1 satellite traversed auroral field lines at radial distances of ∼2.5–4.5 RE near midnight on June 19, 1981. The waves were polarized perpendicular to the magnetic field (k∥sol; k⊥ ≲0.2). In addition, there were waves at slightly above both the helium and the oxygen cyclotron frequencies. The waves occurred within a region of reduced density (∼0.1–0.2/cm³) with the electron temperature greater than the ion temperature, upflowing hydrogen and oxygen beams, and weak field‐aligned currents bounded by electrostatic shocks. The wave characteristics and associations were similar to those observed at lower altitudes by the S3‐3 satellite. Comparisons were made between the observed H+ and O+ beams, field‐aligned currents, densities and temperatures, and linear theories of electrostatic ion cyclotron waves and H+‐O+ two‐stream instabilities. The features of the observed waves are most consistent with the current‐driven mode. In addition, numerical studies of the linear dispersion relation, using parameters based on the observations, showed that both the parallel and oblique two‐stream modes and the ion‐beam driven modes were stable while oblique current driven modes were unstable. The O+ and H+ distributions provide evidence for interactions with local electrostatic ion cyclotron waves and for the H+‐O+ two‐stream instability at altitudes below the satellite.