An ion cyclotron instability, propagating nearly transverse to the ambient magnetic field and having frequencies near the harmonics of the ion cyclotron frequeny, can be excited by the distorted ion velocity distribution functions present in the F region of the high-latitude ionosphere. The instability occurs for D>1.256 (D being the ratio for E¿B0 drift speed to the ion thermal speed, corresponding to the temperature of the neutral species), and its growth rate increases by the increase of D. The instability can generate irregularities with the wavelengths ranging from 3 m to 15 m. At an altitude of about 250 km the instability-induced diffusion dominates over the ion-neutral collisions for wave electric field amplitude levels of about 5% of the ambient electric field value. At higher altitudes the diffusion effects are expected to become even more important.