Despite burgeoning interest in how groups and organizations learn from failures, little is known about how leader behavior influences these learning processes. We analyzed longitudinal data collected at a large hospital and found that leader inclusiveness was positively associated with members' perceptions of psychological safety at Time 1, and that this relationship was stronger for members in low-performing units. Unit psychological safety climate appeared to facilitate learning from failures within the work unit (Time 2), which was positively associated with subsequent unit performance (Time 3).