Electromagnetic drift instability in the lower-hybrid frequency range in the reconnection layer H. Ji, R. Kulsrud, and M. Yamada By using a local two-fluid theory, we investigate an electromagnetic instability in the lower hybrid frequency range driven by cross-field current or relative drifts between electrons and ions. The theory self-consistently takes into account local cross-field current and accompanying pressure gradients. It is found that the instability is caused by reactive coupling between the backward propagating whistler (fast) waves in the moving electron frame and the forward propagating sound (slow) waves in the ion frame when the relative drifts are large. The unstable waves propagate obliquely to the unperturbed magnetic field and have mixed polarization with significant electromagnetic components. A physical picture of the instability emerges as a result of further simplifications of the model. The primary positive feedback mechanism is based on reinforcement of initial electron density perturbations by (de)compression of electron fluid via induced Lorentz force. The resultant waves are qualitatively consistent with the measured electromagnetic fluctuations in reconnecting current sheet in MRX. The resulting resistivity and plasma heating are calculated from quasi-liner theory, and within the experimental uncertainties they are shown to be quite important for the reconnection process. The relationship of these electromagnetic fluctuations to the newly found quadrupole out-of-plane field will be discussed.