Beginning with a review of traditional perspectives on educational leadership, the link between effective principals and school effectiveness, and the bases of social power, this document goes on to report on a 1986-87 study conducted to determine how the types of power used by principals relate to school effectiveness. Subjects were administrators and selected teachers in 34 public middle schools in 9 school districts in New York City. Following a description of participants' background data, study findings are presented via descriptions of an Administrative Behavior Scale and a School Assessment Scale that, together, show relationships between various power behaviors, elements of school effectiveness, and the mutual empowerment of teachers and principals. Different power behaviors by principals are shown to elicit different responses from their teachers, with the use of influence being the most conducive to mutual empowerment, positive organizational climate, and improved teacher performance. Last, eight suggestions for principals' personal policy and style are provided. Included are one figure and nine tables. (25 references) (CLA)