Intense electrostatic waves in the auroral E region have been detected simultaneously on two payloads launched in a mother-daughter configuration from Kiruna, Sweden. The data sets comprise electric field and density measurements from the ambient (dc) conditions to fluctuations as high as 50 kHz. The dc electric field measured by both payloads was 54 mV/m northwest, which corresponded to an electron drift velocity of 1080 m/s. This electric field drove two-stream waves perpendicular to both B and E observed by both spacecraft throughout an altitude region which agrees quite well with the range predicted by linear two-stream theory. The power in the waves depended on the electron density gradient, diminishing near 107 km where the gradient changed direction for a few kilometers. This observation is consistent with a gradient drift wave contribution to the instability process, since the auroral zone geometry does permit a component of the electric field perpendicular to B to be parallel to the vertical electron density gradient. Electric field spectra corroborate these results, as a strong component was detected at longer wavelengths (several hundred meters), the spectral regime associated with this instability. The spectra measured on both payloads also reveal an enhanced nearly coherent wave of a few meters wavelength at the topside of the layer (120 km), which also appears as electrostatic and parallel to the current. This spectral feature may be the consequence of a narrow range of wavelengths excited near the two-stream instability threshold. Descending through the layer, the fluctuations fill out to a broadband, turbulent spectrum, extending to scale sizes down to the order of centimeters. Long wavelength waves form the strongest spectral component below 105 km. Power observed perpendicular to the direction of the current may indicate the presence of secondary plasma waves.