The current study aimed to see the relationship between psychological empowerment and employees' engagement in school teachers to enhance teaching quality and overall educational effectiveness. The study hypothesized that (a) there would be a positive relationship between psychological empowerment and employee engagement in public and private school teachers; (b)psychological empowerment would be a positive predictor of employee engagement in public and private school teachers;(c) there would be significant gender differences between psychological empowerment and employee engagement in public and private school teachers; and (d)there would be significant institutional differences in psychological empowerment and employee engagement in public and private school teachers. To test these hypotheses, a total of 100 school teachers, 50 men (n=25 from public school and n=25 from private school) and 50 women (n=25 from public school, n=25 from private school), were approached through a purposive sampling strategy. Psychological empowerment was measured using the Psychological Empowerment Scale (Spreitzer, 1995), and employee engagement was measured using the Work and Well-being Survey (UWES) (Schaufeli et al., 2002). The findings showed a positive relationship between psychological empowerment and employee engagement. Moreover, Simple linear regression showed that psychological empowerment significantly predicted employee engagement. This study will help educational experts devise strategies to enhance teachers' psychological empowerment and engagement.