Directors in substance use treatment programs are increasingly required to respond to external economic and socio-political pressures. Leadership practices that promote innovation can help offset these challenges. Using focus groups, factor analysis, and validation instruments, the current study developed and established psychometrics for the Survey of Transformational Leadership. In 2008, clinical directors were evaluated on leadership practices by 214 counselors within 57 programs in four U.S. regions. Nine themes emerged: integrity, sensible risk, demonstrates innovation, encourages innovation, inspirational motivation, supports others, develops others, delegates tasks, and expects excellence. Study implications, limitations, and suggested future directions are discussed.