Background: Health Care Systems face an unprecedented pressure in the 21stcentury. Building and sustaining good health care services and systems remains a challenge throughout the world generally and for developing economies particularly and is known to have a massive impact on the society and ultimately the economic well-being of a nation. This study addresses how Ethical Leadership and its factors of interpersonal justice and informational justice can play a role in fostering the climate of innovation; continuous development and consistency in the healthcare sector. Methods: The data was collected by administering standard questionnaires for each of the involved variable. The health care industry particularly public and private Hospitals in Pakistan were targeted to collect relevant data. The data analysis was performed through the software for Statistical Package for Social Sciences (SPSS). The analysis included the descriptive analysis, frequencies, reliability analysis, correlation analysis and Regression analysis. Results: The results state a significant and positive relationship between ethical leadership and climate of innovation in the Health care sector of Pakistan with a significance level <0.05. Conclusion: Given the need for innovation as a solution to the complex challenges faced by health care organizations, ethical leadership plays an important role in promoting climate of innovation in the Health Care sector of Pakistan, which may benefit both the Health care service providers and those who avail the services.