Public sector organizations experiencing scandals due to unethical behavior pay a high price in personal and organizational losses, but moreover, trust in public service leaders is lost. It is critical that scholars interested in ethical governance empirically discover the factors that influence improved ethical behavior in public administration. Two factors have been theoretically linked to improved ethical behavior—ethical reasoning and the transformational leadership style. The primary objective of this research study was to quantitatively test the linear correlation between cognitive-moral development (CMD) and leadership style in a federal public sector organization. A secondary objective was to examine the correlation between ethical reasoning and the demographic variables of age, gender, education, and organizational discipline. The sample population of federal managers completed the DIT2 survey to assess CMD and their direct reports completed the MLQ survey to evaluate the manager's leadership style. The results reflected a weak positive correlation between ethical reasoning and the transformational leadership style; however, it was not statistically significant. Also, the data indicated a positive correlation between gender, education, and organizational discipline but an inverse relationship with age. A positive correlation for gender and education was expected and is supported by prior studies. However, the finding of an inverse relationship between moral reasoning and age contradicts numerous research findings indicating that moral reasoning increases with age.