Radiative-moist-convective equilibrium (RCE) is a simple paradigm for the statistical equilibrium the earth’s climate would exhibit in the absence of lateral energy transport. It has generally been assumed that for a given solar forcing and long-lived greenhouse gas concentration, such a state would be unique, but recent work suggests that more than one stable equilibrium may be possible. Here we show that above a critical specified sea surface temperature, the ordinary RCE state becomes linearly unstable to large-scale overturning circulations. The instability migrates the RCE state toward one of the two stable equilibria first found by Raymond and Zeng (2000). It occurs when the clear-sky infrared opacity of the lower troposphere becomes so large, owing to high water vapor concentration, that variations of the radiative cooling of the lower troposphere are governed principally by variations in upper tropospheric water vapor. We show that the instability represents a subcritical bifurcation of the ordinary RCE state, leading to either a dry state with large-scale descent, or to a moist state with mean ascent; these states may be accessed by finite amplitude perturbations to ordinary RCE in the subcritical state, or spontaneously in the supercritical state. As first suggested by Raymond (2000) and Sobel et al. (2007), the latter corresponds to the phenomenon of self-aggregation of moist convection, taking the form of cloud clusters or tropical cyclones. We argue that the nonrobustness of self-aggregation in cloud system resolving models may be an artifact of running such models close to the critical temperature for instability.