BackgroundModification of the learning environment enhances academic performance, and meta-motivational skills. Yet it is largely unknown which underlying cause potentiates these effects. The study’s goal is to analyse flipped classroom (FC) effect on basic psychological needs and self-esteem.Methods40 undergraduate medical students participated in a one-site two phased study. In Phase I, students attended a traditional lecture-based classroom (TC). In Phase II, the same group attended FC. Upon completion of each Phase students completed two questionnaires: Basic Psychological Need Satisfaction and Frustration Scale, and Rosenberg self-esteem scale.ResultsAutonomy satisfaction was significantly higher in FC (n = 40, z = 5.520, p < .001), the same tendency was seen for Competence satisfaction in FC (n = 40, z = 5.122, p < .001). As for the frustration of all three needs, the statistical difference was observed for all three subscales between TC and FC. In FC, autonomy (n = 40, z = − 5.370, p < .001), relatedness (n = 40, z = 4.187, p < .001), and competence (n = 40, z = − 5.323, p < .001) frustration was significantly lower. Self-esteem was significantly higher in FC (n = 40, z = 5.528, p < .001). In TC self-esteem negatively correlated with autonomy frustration, (r(38) = − 0.430, p < .01), and competence frustration, (r(38) = − 0.379, p < .05). In FC, self-esteem positively correlated with autonomy satisfaction (r(38) = 0.316, p < .05), and competence satisfaction (r(38) = 0.429, p < .01).ConclusionsFC better fulfils students’ basic psychological needs, specifically needs for autonomy and competence, and self-esteem compared to TC. Collaborative work, and academic scaffolding, contributes to behavioural engagement of students in the learning process. FC with the main focus on students’ active involvement may better meet millennials’ needs. Implementing validated questionnaires to measure students’ psychological needs should become a regular practice in medical schools, specifically during the process of curriculum redesign.