A model for the linear theory of the overdense thermal self-focusing instability, as generated by high power radio waves, in the high-latitude F-region ionosphere is developed. We treat self-focusing-driven irregularities with scale sizes, perpendicular to the geomagnetic field, on the order of a kilometer and smaller. We find that E-region coupling leads to nonambipolar perpendicular diffusive effects. The conducting E-region is shown to increase the threshold for the thermal self-focusing instability. Growth rates of the thermal self-focusing instability are computed, including E-region conductivity effects, for a range of radio wave amplitudes.