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Building on the body of positive organizational behavior research, this study examines the relationships between leader psychological capital, follower psychological capital, job engagement and job performance (task performance and contextual performance). Data were collected in three phases from multiple sources involving 60 leaders and 319 followers from a large telecom company in Taiwan. Hierarchical linear modeling results revealed that leaders' psychological capital was positively related to their job engagement through the mediation of followers' psychological capital. Furthermore, the results indicated that job engagement mediates the relationship between followers' psychological capital and their job performance (task performance and contextual performance). We discuss the implications and limitations of these findings and directions for future research
