In this research we examined the impact of empowering leadership behaviors (ELBs), psychological empowerment, and individual-level power values on a broad range of employee behaviors. Drawing on self-determination theory (Gagné and Deci, 2005), we hypothesized that ELBs would have direct effects on in-role and affiliative extra-role behaviors, but that the impact of ELBs on challenging extra-role behaviors would be mediated by psychological empowerment. Further, we hypothesized that individual-level power values (Schwartz, 1992) would moderate the mediated effect of ELBs on challenging behaviors. Responses to questionnaires from 541 employees and their supervisors were obtained from 16 hotel properties located in 11 Middle Eastern and Asian countries. Results supported our hypotheses of direct and mediated effects of ELBs on employee behaviors, and supported moderated mediation involving psychological empowerment and power values such that psychological empowerment was more strongly related to challenging behaviors for individuals low in power values.Empirical evidence clearly demonstrates that empowerment can have a significant impact on a broad range of important outcomes in many organizational contexts. Empowerment is associated with job satisfaction (Sparrowe, 1994;Spreitzer et al., 1997), managerial effectiveness (Spreitzer et al., 1997), creativity (Zhang and Bartol, in press), and team performance Kirkman and Rosen, 1999;Kirkman et al., 2004) and negatively related to strain (Spreitzer et al., 1997) and turnover intentions (Sparrowe, 1994). Moreover, in a recent large-scale longitudinal study, Birdi et al. (2008) found that empowerment was the strongest predictor of organizational productivity among the seven management practices examined.Researchers have approached the notion of empowerment from a variety of theoretical perspectives (Leach et al., 2003;Menon, 2001). One approach conceptualizes empowerment as a set of practices or managerial techniques in which empowering leadership behaviors play a central role (Arnold et al., 2000;Conger and Kanungo, 1988;Manz and Sims, 1987). A second approach focuses on psychological empowerment as a cognitive motivational state reflecting individuals' psychological reactions to empowering techniques and leadership behaviors (Spreitzer, 1995;Thomas and Velthouse, 1990).Psychological empowerment has been depicted as 'a consequence and necessary adjunct to situational empowerment' (Leach et al., 2003: 28). However, very little research has attempted to investigate empowering leadership and psychological empowerment in conjunction (Zhang and Bartol, in press, is an exception), and the notion that empowering leadership behaviors can be effective only insofar as they lead to increased psychological empowerment has never been explicitly tested. Indeed, although recent research on empowerment has examined very different behavioral outcomes, at least one study shows an effect of empowering leader behaviors that is not mediated by psychological empowerment (e.g. Ahearne et al....