This research sought to examine the mediating role of psychological capital in the relationship between authentic leadership and work engagement among school principals and teachers. The study had a descriptive, correlational design. The statistical population of the study was comprised of all school principals and teachers in Aleshtar (located in Lorestan Province) in school year 2016-17 from among whom 295 individuals were selected through random simple sampling method. It is worth mentioning that the sample size was determined via the Cochran formula. The instruments included Utrecht Work Engagement Scale (UWES) (2003), Luthan’s Psychological Capital Questionnaire (PCQ) (2007), and Authentic Leadership Questionnaire (ALQ) (Walumbwa, et al., 2008). Evaluation of the proposed model was performed through SEM and using SPSS20 and AMOS20. Results demonstrated that the proposed structural model provided a good fit to the data and there was a significant, positive relationship between authentic leadership, psychological capital, and work engagement. Furthermore, the results showed that the direct relationship between authentic leadership and psychological capital was significant. This also holds true for the direct relationship between psychological capital and work engagement. Nevertheless, the direct relationship between authentic leadership and work engagement was not significant. Findings also indicated that the indirect relation between authentic leadership and work engagement through moderation of psychological capital was significant. Accordingly, although authentic leadership had a significant, positive relationship with work engagement; however, this association was meaningful through the mediation of psychological capital and this variable had no effect on personnel work engagement by itself.