Key points Mutations in the Cav3.2 T‐type Ca2+ channel were found in patients with idiopathic generalized epilepsies, yet the mechanisms by which these mutations increase neuronal excitability and susceptibility to seizures remain to be determined. Using electrophysiological and transfection methods, we validate in cultured hippocampal neurons the hypothesis that an epilepsy mutation increases neuronal excitability. Mutations in the I–II loop of the channel increase trafficking to the plasma membrane without altering trafficking into dendrites. Mutations also enhance dendritic arborization. Additionally, we provide the first evidence that Cav3.2 can signal to Ca2+‐regulated transcription factors, which are known to play important roles in neuronal development and gene expression. Abstract T‐type calcium channels play essential roles in regulating neuronal excitability and network oscillations in the brain. Mutations in the gene encoding Cav3.2 T‐type Ca2+ channels, CACNA1H, have been found in association with various forms of idiopathic generalized epilepsy. We and others have found that these mutations may influence neuronal excitability either by altering the biophysical properties of the channels or by increasing their surface expression. The goals of the present study were to investigate the excitability of neurons expressing Cav3.2 with the epilepsy mutation, C456S, and to elucidate the mechanisms by which it influences neuronal properties. We found that expression of the recombinant C456S channels substantially increased the excitability of cultured neurons by increasing the spontaneous firing rate and reducing the threshold for rebound burst firing. Additionally, we found that molecular determinants in the I–II loop (the region in which most childhood absence epilepsy‐associated mutations are found) substantially increase the surface expression of T‐channels but do not alter the relative distribution of channels into dendrites of cultured hippocampal neurons. Finally, we discovered that expression of C456S channels promoted dendritic growth and arborization. These effects were reversed to normal by either the absence epilepsy drug ethosuximide or a novel T‐channel blocker, TTA‐P2. As Ca2+‐regulated transcription factors also increase dendritic development, we tested a transactivator trap assay and found that the C456S variant can induce changes in gene transcription. Taken together, our findings suggest that gain‐of‐function mutations in Cav3.2 T‐type Ca2+ channels increase seizure susceptibility by directly altering neuronal electrical properties and indirectly by changing gene expression.