ABSTRACT The vertical density distribution of stars in a galactic disc is traditionally obtained by assuming an isothermal vertical velocity dispersion of stars. Recent observations from SDSS, LAMOST, RAVE, Gaia etc. show that this dispersion increases with height from the mid-plane. Here, we study the dynamical effect of such non-isothermal dispersion on the self-consistent vertical density distribution for the thin disc stars in the Galaxy, obtained by solving together the Poisson equation and the equation of hydrostatic equilibrium. We find that in the non-isothermal case the mid-plane density is lower and the scale height is higher than the corresponding values for the isothermal distribution, due to higher vertical pressure, hence the distribution is vertically more extended. The change is $\sim \! 35 {{\ \rm per\ cent}}$ at the solar radius for a stars-alone disc for the typical observed linear gradient of +6.7 km s−1 kpc−1 and becomes even higher with increasing radii and increasing gradients explored. The distribution shows a wing at high z, in agreement with observations, and is fitted well by a double $\operatorname{sech}^{2}$, which could be mis-interpreted as the existence of a second, thicker disc, specially in external galaxies. We also consider a more realistic disc consisting of gravitationally coupled stars and gas in the field of dark matter halo. The results show the same trend but the effect of non-isothermal dispersion is reduced due to the opposite, constraining effect of the gas and halo gravity. Further, the non-isothermal dispersion lowers the theoretical estimate of the total mid-plane density i.e. Oort limit value, by 16 per cent.