<b>Purpose:</b> To assess nurses’ perceptions about the transformational leadership applied in psychiatric hospitals and to investigate factors that influence these perceptions. <b>Materials and methods:</b> A descriptive study was conducted in a psychiatric hospital and a psychiatric ward of a general hospital located in a city of Cyprus. A convenience sample of 95 nurses was used, while the Greek version of the « Kuopio University Hospital Transformational Leadership Scale (KUHTLS) questionnaire was used as an instrument. <b>Results:</b> Appreciation, decision making fairness, and individuality were the variables with the highest mean values. Women had significantly higher scores in appreciation, justice, and individuality compared to men. Nurses who were >45 years old had a significantly higher score compared to those who were 31-45 and <30 years old in the subscales decision making (p=0.005), appreciation (p=0.043), development (p=0.020), work efficiency and outcomes (p=0.030). Head and senior nurses had significantly higher scores regarding subscales decision making (p=0.003), appreciation (p=0.025), development (p=0.010), work efficiency and outcomes (p=0.004). Nurses with > 7 years of work experience, had significantly higher scores in fairness subscale compared with the nurses who had less than seven years of work experience (p=0.034). <b>Conclusions:</b> Nurses working in those psychiatric hospitals and ward had positive perceptions about transformational nursing leadership. Hospital administrators should facilitate training programs for nurse managers in leadership styles and their effects on job satisfaction.