Leadership has been identified as an essential ingredient of educational reform aiming to ensure that every student gets the education they need to succeed in an era of high accountability. Transformational leadership in the educational context is conceptualized as a process of building commitment to meet the challenges faced by professionals in education everyday while empowering teachers to become leaders in the process of educating our children. The purpose of this study was to examine how much of the total variance of teacher leadership development and teacher efficacy can be accounted for or explained by their principal's transformational leadership behaviors as perceived by teachers from a South Texas school district and to examine the difference between elementary and secondary teachers' perceptions with regards to their principals' transformational leadership behaviors. Two hundred eighty-three teachers completed surveys for this quantitative study. Confirmatory factor analysis revealed that setting directions, redesigning the organization, and developing people were the transformational leadership practices recognized by participants in this study. Multiple regression analyses revealed that principal's transformational leadership behaviors have a significant effect on three distinguishable dimensions or support characteristics that foster teacher leadership development: developmental focus, recognition, and environment. Principals' transformational leadership behaviors also explained a statistical significant amount of the variance of teachers' classroom management and instructional strategies as sources of self efficacy. A two-way factorial analysis found no significant differences between the perceptions of elementary and secondary teachers with regards to their principals' transformational leadership behaviors. These findings suggest that principals' transformational leadership behaviors have a statistically significant effect on teachers' leadership development and sense of self efficacy both at the elementary and secondary levels. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com/en-US/products/dissertations/individuals.shtml.]