Principals play a unique role in school and student outcomes. This paper presents findings of a study that explored how principals' leadership behaviors influenced teachers' sense of efficacy. Specifically, the paper describes how principals in three middle schools influenced teachers' sense of efficacy and affected instructional and school improvement from a teacher perspective. Bandura's (1977, 1986) social cognitive learning theory of self-efficacy provided the theoretical framework. The first phase of the study surveyed 280 teachers in 10 schools to determine the level of personal teaching efficacy (PTE) and general teaching efficacy (GTE). Three middle schools were selected: one with the highest reported GTE, one with the highest reported PTE, and one with the lowest combined GTE and PTE. Data for the second phase were gathered through observation and interviews with 34 teachers. The study identified 10 leadership behaviors: models behavior, believes in teacher capacity, inspires group purpose, promotes teacher empowerment and shared decision making, recognizes teacher efforts, provides personal and professional support, manages student behavior, promotes a sense of community, fosters teamwork and collaboration; and encourages innovation and continual growth. In summary, the study showed that principals' direct behaviors, as well as indirect symbolic forms of instructional leadership, influence teachers' work and its outcomes. Three tables and one figure are included. (Contains 52 references.) (LMI)