This thesis explores the role of leadership in fostering employee creativity in enhancing innovation within tech startup environments, focusing on the application of transformational and transition leadership theories with the support of psychology of sustainability, (PoS) to help in the findings our study. Drawing on qualitative data from semi-structured interviews with both startup leaders and employees, the study investigates how leadership style influence creativity and innovation in tech startup. The findings reveal that transformational leadership practices such as vision-setting, intellectual stimulation, and empowerment create psychologically safe and intrinsically motivating environments that support creativity and innovation. Transition leadership complements this by shaping adaptive structures and guiding teams through systemic change, particularly during periods of organisational growth. Participants consistently emphasised the importance of autonomy, decentralised decision-making, and customer-centric innovation as drivers of creativity. The findings also reveal the significance of organisational culture, structured autonomy, and work-life balance as important factors in sustaining creativity performance. Besides that, it was also highlighted that the Swedish work culture, characterised by low power distance and a collaborative workplace, further reinforces the conditions necessary for creativity to flourish. The analysis concludes that leadership in startups must be both inspirational and adaptive, balancing strategic clarity with operational flexibility, and this enables individual creativity at the same time also embeds innovation into the core of organisational design. The study contributes to the literature on sustainable leadership and offers practical insights for founders, team leaders, and organisational developers seeking to cultivate creativity in dynamic business environments.