Motivation: The genetic basis of complex traits often involves the function of multiple genetic factors, their interactions and the interaction between the genetic and environmental factors. Gene-environment (G×E) interaction is considered pivotal in determining trait variations and susceptibility of many genetic disorders such as neurodegenerative diseases or mental disorders. Regression-based methods assuming a linear relationship between a disease response and the genetic and environmental factors as well as their interaction is the commonly used approach in detecting G×E interaction. The linearity assumption, however, could be easily violated due to non-linear genetic penetrance which induces non-linear G×E interaction. Results: In this work, we propose to relax the linear G×E assumption and allow for non-linear G×E interaction under a varying coefficient model framework. We propose to estimate the varying coefficients with regression spline technique. The model allows one to assess the non-linear penetrance of a genetic variant under different environmental stimuli, therefore help us to gain novel insights into the etiology of a complex disease. Several statistical tests are proposed for a complete dissection of G×E interaction. A wild bootstrap method is adopted to assess the statistical significance. Both simulation and real data analysis demonstrate the power and utility of the proposed method. Our method provides a powerful and testable framework for assessing non-linear G×E interaction. Contact: cui@stt.msu.edu Supplementary information: Supplementary data are available at Bioinformatics online.