Purpose: To examine how federal/state-level policy guidance and local context have influenced district and school leader responses to the COVID-19 pandemic, as well as how these external/internal factors might provide a window into K-12 crisis leadership and policy sensemaking more broadly. Research: Investigating two districts over two years (2020–2022), data gathered include 39 hours of interviews with K-12 leaders (n = 41) and teachers (n = 18), federal/state-level policy documents (N = 64) governing these districts, and school staff responses to the Comprehensive Assessment of Leaders for Learning survey (N = 111). Drawing theoretically upon sensemaking, crisis leadership/management, law/policy implementation, and organizational theory, these data were analyzed using both inductive and deductive coding over several phases. Findings: In tracing the confluence of federal/state-level guidance and local capacities, we find both influenced K-12 leaders’ sensemaking and subsequent responses to COVID-19. However, districts that possessed adequate expertise and organizational resources were better positioned to respond to the crisis, whereas those lacking such capacities experienced increased anxiety/stress. Conclusion: We argue that the COVID-19 pandemic provides a new window into the critical external/internal factors influencing K-12 leader sensemaking and subsequent responses to crises more broadly. We also discuss the potential role intermediate service agencies might play in the development of a stronger crisis response infrastructure for associated districts and schools. Finally, we point out how principal preparation programs and professional development efforts could prospectively address such crisis-related challenges faced by K-12 leaders.