Although involvement of the cerebello-thalamo-cortical network has often been suggested in essential tremor, the source of oscillatory activity remains largely unknown. To elucidate mechanisms of tremor generation, it is of crucial importance to study the dynamics within the cerebello-thalamo-cortical network. Using a combination of electromyography and functional magnetic resonance imaging, it is possible to record the peripheral manifestation of tremor simultaneously with brain activity related to tremor generation. Our first aim was to study the intrinsic activity of regions within the cerebello-thalamo-cortical network using dynamic causal modelling to estimate effective connectivity driven by the concurrently recorded tremor signal. Our second aim was to objectify how the functional integrity of the cerebello-thalamo-cortical network is affected in essential tremor. We investigated the functional connectivity between cerebellar and cortical motor regions showing activations during a motor task. Twenty-two essential tremor patients and 22 healthy controls were analysed. For the effective connectivity analysis, a network of tremor-signal related regions was constructed, consisting of the left primary motor cortex, premotor cortex, supplementary motor area, left thalamus, and right cerebellar motor regions lobule V and lobule VIII. A measure of variation in tremor severity over time, derived from the electromyogram, was included as modulatory input on intrinsic connections and on the extrinsic cerebello-thalamic connections, giving a total of 128 models. Bayesian model selection and random effects Bayesian model averaging were used. Separate seed-based functional connectivity analyses for the left primary motor cortex, left supplementary motor area and right cerebellar lobules IV, V, VI and VIII were performed. We report two novel findings that support an important role for the cerebellar system in the pathophysiology of essential tremor. First, in the effective connectivity analysis, tremor variation during the motor task has an excitatory effect on both the extrinsic connection from cerebellar lobule V to the thalamus, and the intrinsic activity of cerebellar lobule V and thalamus. Second, the functional integrity of the motor network is affected in essential tremor, with a decrease in functional connectivity between cortical and cerebellar motor regions. This decrease in functional connectivity, related to the motor task, correlates with an increase in clinical tremor severity. Interestingly, increased functional connectivity between right cerebellar lobules I-IV and the left thalamus correlates with an increase in clinical tremor severity. In conclusion, our findings suggest that cerebello-dentato-thalamic activity and cerebello-cortical connectivity is disturbed in essential tremor, supporting previous evidence of functional cerebellar changes in essential tremor.