Background: The study examined the influence of implementation of employee empowerment on competitive advantage in hospitals within Nairobi. The study looked at the following aspects of employee empowerment; competence, teamwork, motivation, reward and recognition. Employee empowerment is derived from the Total Quality Management (TQM) principles bringing forth competitive advantage that results from high customer satisfaction levels, employee satisfaction and operations efficiency. Methods: A descriptive correlational research design that applied positivism philosophy. Data was collected from both private and public hospitals within Nairobi targeting patients who were admitted in these hospitals for more than three days during the study period and senior employees of the respective hospitals. There were 308 participants, 154 hospital employees and 154 patients from 31 hospitals within Nairobi. After institutional and individual consent was obtained, participants filled a self-administered questionnaire. The collected data was coded into SPSS Version 23 software and the analysis was done using descriptive and inferential statistics. Results: The findings illustrated that employee empowerment significantly predicted competitive advantage. High responsiveness and good attitude, being reliable, empathy and assuring the patients of their state best enhance patients’ and employee satisfaction. Conclusion: This brings out the importance of realigning the staff inputs towards improving patient experiences, as well as considering employees’ performance as individual instead of considering them as teams.