Results are presented from a linear-stability analysis of the flow at the head of two-dimensional gravity-current fronts. The analysis was undertaken in order to clarify the instability mechanism that leads to the formation of the complex lobe-and-cleft pattern which is commonly observed at the leading edge of gravity currents propagating along solid boundaries. The stability analysis concentrates on the foremost part of the front, and is based on direct numerical simulation data of two-dimensional lock-exchange flows which are described in the companion paper, Härtel et al. (2000). High-order compact finite differences are employed to discretize the stability equations which results in an algebraic eigenvalue problem for the amplification rate, that is solved in an iterative fashion. The analysis reveals the existence of a vigorous linear instability that acts in a localized way at the leading edge of the front and originates in an unstable stratification in the flow region between the nose and stagnation point. It is shown that the amplification rate of this instability as well as its spanwise length scale depend strongly on Reynolds number. For validation, three-dimensional direct numerical simulations of the early stages of the frontal instability are performed, and close agreement with the results from the linear-stability analysis is demonstrated.