Her PhD dissertation, "The drag queens; a study in urban anthropology" (1968), examined the experiences, social interactions, and culture of drag queens, or (mostly gay-identified) men who dressed and performed as women in various kinds of theatrical settings or as an expression/performance of their sexual identity. Later published in several articles and as Mother camp: female impersonators in America (1972), Newton's work represented the first major anthropological study of a homosexual community in the United States and also laid some of the groundwork for theorists such as Judith Butler, who would later explore the performative dimensions of sex and gender roles.
Her second book, Cherry Grove, Fire Island: Sixty years in America’s first gay and lesbian town (1993), used oral history and ethnographic methods to document the changing dynamics of Cherry Grove, a beach resort on Fire Island, New York and one of the oldest and most visible predominantly lesbian and gay communities in the United States.
She identifies as lesbian and is currently Professor Emerita of Anthropology and Kempner Distinguished Research Professor at Purchase College, State University of New York. Newton is also a Lecturer in Women's Studies and American Culture at the University of Michigan in Ann Arbor, Michigan. Esther Newton is in a long-term partnership with controversial lesbian-feminist performance artist Holly Hughes.