In the near-Earth plasma sheet the pressure gradient and magnetic curvature are both directed earthward. This region is thus potentially unstable to the ballooning mode provided that the plasma &bgr; becomes large enough. In this a work a three-dimensional electromagnetic full-particle simulation is used to study the evolution of the near-Earth plasma sheet under the influence of an external convection electric field. As the plasma &bgr; increases to ~10 during the convection process, the excitation of a drift ballooning mode is observed whose real frequency and growth rate agree well with fluid predictions including the effect of the ion diamagnetic drift. The maximum intensity in the ballooning spectrum corresponds to an azimuthal mode number m~60. The spectrum is observed to evolve toward shorter wavelengths, but this process stops at the ion gyroradius scale. There is no sign of an explosive nonlinear stage of the instability. The bulk flows produced by the mode are only moderate (≲ 200 km/s), and the instability is not observed to produce any topological change in the plasma sheet configuration. ¿ 1999 American Geophysical Union