A spiraling ion beam propagating through a magnetized dusty plasma cylinder drives electrostatic lower hybrid waves to instability via cyclotron interaction. Numerical calculations of the growth rate and unstable mode frequencies have been carried out for the Princeton Q-1 device using the experimental dusty plasma parameters [e.g., Barkan et al., Planet. Space Sci. 43, 905 (1995)]. It is found that as the density ratio δ(=nio∕neo, where ni0 is the ion plasma density and ne0 is the electron density) of negatively charged dust grains to electrons increases, the unstable mode frequency of the lower hybrid waves increases. In addition, the growth rate of the instability also increases with the density ratio δ. In other words, the presence of negatively charged dust grains can further destabilize the lower hybrid wave instability. The growth rate has the largest value for the modes where Jl(pnro) is maximum [here pn=xn∕r0, where pn is the perpendicular wave number in cm−1, r0 is the plasma radius, and xn are the zeros of the Bessel function J1(x)] i.e., whose eigenfunctions peak at the location of the beam. The growth rate scales as one third power of the beam current.