Ethical scandals in organizations are often cited when pointing to leaders as the culprits who foster corruption in their organization. However, little empirical work examines the individual processes through which ethical leadership may influence follower unethical behavior and altruistic behavior. Drawing from principles of social learning theory and social cognitive theory, moral disengagement is presented as a means by which ethical leadership may influence followers. Specifically, I hypothesize that ethical leadership influence on follower unethical behavior and altruistic behavior is mediated through follower moral disengagement. The present study examined the mediating processes in the relationship between ethical leadership and employee unethical behavior as well as altruistic behavior using a sample of 766 employees from the People's Republic of China. A structured questionnaire was employed as the research instrument for this study. It consisted of four scales designed to measure the variables of ethical leadership, moral disengagement, unethical behavior, and altruistic behavior. All the scales were well-established in the literature. SPSS16.0 and Lisrel8.70 were adopted to perform a series of statistical analyses. Structural Equation Model was used to test the hypotheses. Results revealed that ethical leadership was negatively related to follower unethical behavior (?=-.14, p<.001) and positively related to altruistic behavior (?=.37, p<.001), and moral disengagement was positively related to follower unethical behavior (?=.37, p<.001) and negatively related to altruistic behavior (?=-.41, p<.001). Consistent with predictions, we found that ethical leadership had a significant negative influence on unethical behavior (?=-.13, p<.001), and that moral disengagement fully mediated the negative influence of ethical leadership on unethical behavior. Meanwhile, we also found that ethical leadership had a significant positive influence on altruistic behavior (?=.38, p<.001), and that moral disengagement partially mediate the positive influence of ethical leadership on altruistic behavior. Finally, the inclusion of and moral disengagement as mediating variables adds to the growing body of research that demonstrates the importance of ethical leadership influence on both unethical behavior and altruistic behavior. Implications for theory and research are discussed.