We predict the new type of phase transition in quasi one-dimensional system of interacting electrons at high magnetic fields, the stabilization of a density wave which transforms a two dimensional open Fermi surface into a periodic chain of large pockets with small distances between them. We show that quantum tunneling of electrons between the neighboring closed orbits enveloping these pockets transforms the electron spectrum into a set of extremely narrow energy bands and gaps that decreases the total electron energy, thus leading to a emph{magnetic breakdown induced density wave} ground state analogous to the well-known instability of Peierls type.
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