Standard models of the Earth's outer magnetospheric waveguide assume that a perfectly reflecting magnetopause can trap energy inside the waveguide. In contrast, we show that the near-noon magnetopause often acts as a leaky boundary, wave trapping only being possible for large magnetosheath flow speeds. Moreover, for sufficiently fast flow speeds, we show how waveguide modes may be energized by magnetosheath flows via the overreflection mechanism. Unbounded simulations of the growth of surface waves via the development of a Kelvin-Helmholtz instability (KHI) vortex sheet show growth rates which increase without limit proportional to wavenumber (ky), until the assumption of a thin boundary is no longer valid. For a bounded magnetosphere, however, overreflected body type waveguide modes can introduce wavenumber selection, that is, generate modes with maximum linear growth rates at finite ky. A necessary condition is that the wave is propagating in the magnetosphere, that is, the wave's turning point lies inside the magnetosphere. By developing a new description of both KHI and waveguide mode growth in terms of overreflection and the propagation of negative energy waves, we show how the maximum growth rate can be understood in terms of the reflection coefficient of waves incident upon the magnetopause. Our model can also explain the observed local time dependence of Pc5 field line resonance wave power, and can explain the observed correlation between high solar wind speeds and Pc5 wave power. Finally, we show how a waveguide with a free magnetopause boundary supports quarter-wavelength modes. These modes have lower frequencies than the standard (magnetopause velocity node) half-wavelength modes, perhaps generating the millihertz waveguide mode eigenfrequencies which appear to drive field line resonances in HF radar data. ¿ 1999 American Geophysical Union