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The purpose of this study was to develop an agile leadership theory, which involved the identification of leadership characteristics and outcomes from agile teams as they incorporated agile principles to increase value to their customers. Although outputs of agile teams and how job satisfaction of employees affect customer satisfaction are well known, existing research does not fully cover the outcomes that agile teams generate. This makes it hard for risk-averse organizations to adopt agile transformations and efficiently equip their employees with agile leadership skills. A general inductive approach with strategies from constructivist grounded theory was used to collect and analyse data. Participants for this study were selected from agile teams at National Aeronautics and Space Administration using theoretical sampling and performing a constant comparative analysis driven by the data, aiming to draw out recurring patterns and most notable categories. Those resulted in four agile leadership characteristics and four outcomes from agile teams, and a proposed agile leadership model emerged as a path to developing a theory. Organizations can use these findings to support workforce development planning and measure their agile transformation efforts.