In hospitals of Addis Ababa, there is a high turnover of leaders while patient and health workers’ satisfaction is low, and safety and quality are in dire situations. The purpose of this study was to explore and propose strategies to improve effectiveness of hospital leadership in order to enhance the quality of health care provided in hospitals through improving health workers’ empowerment, job satisfaction and patient safety culture. Thus, a sequential explanatory mixed method research design was used. The research had three phases, in which the first phase used five structured questionnaires explored leadership styles, the health workers’ satisfaction and empowerment, patient safety culture, and the patient experience of quality of health care; while the second involved a qualitative study (content analysis); and third phase focused on the preparation of a strategy document. Data in the form of interview responses was gathered from 75 leaders, 542 health workers, 532 patients and 11 key informants. The analysis shows that, overall, hospital leaders considered themselves more transformational (M=2.98, SD=0.41) than transactional (M=2.85, SD=0.46). Job satisfaction of private and public hospital health workers were 70.8 % and 57.1 % respectively (P-value<0.001). In addition, private hospital workers had a higher score in structural and psychological empowerment than their pubic hospital counterparts; the difference was statistically significant in all dimensions (P-value <=0.03). The analysis reveals that public and private hospitals’ mean total patient safety scores were 3.58 and 3.77 respectively (P-value=0.02). Finally, the “overall rating of hospital” was better for private hospitals: 84.8% and 88.4 % respectively (P-value=0.03). The study makes a number of observations. It notes that, firstly, transformational leadership has direct and strong correlation with structural and psychological empowerment (r=0.70, P-value=0.04 and r=0.83, P-value=0.01 respectively). Secondly, structural empowerment has a direct and significant effect on psychological empowerment (β=0.28, P-value=<0.01); and minimal indirect effect on patient safety culture through psychological empowerment (β=0.05, P-value=<0.05). Thirdly, health worker job satisfaction also has had a direct effect on patient safety culture (β=0.44, Pvalue=< 0.01. The fourth and final observation is that psychological empowerment has had a direct and statistically significant effect on patient safety culture (β=0.19, Pvalue=< 0.01). These observations indicate that, although private hospitals are better in every dimension of this study, the current hospitals situation in Addis Ababa needs urgent attention. Hence, the identification and recommendation for the preparation of eight strategic priority areas along with key interventions seeking to improve the hospital leaders’ effectiveness. / Health Studies / D. Litt. et Phil. (Health Studies)