Workplace failure is inevitable in dynamic organizational settings, yet its management significantly affects employee resilience, innovation, and long-term productivity. This paper investigates the role of failure-tolerant leadership in facilitating effective workplace failure management. Drawing from organizational behavior theories and leadership frameworks, the study explores how leaders who embrace mistakes, encourage psychological safety, and promote learning can transform failure into a developmental opportunity. Using both empirical evidence and literature-based insights, the paper identifies key attributes of failure-tolerant leadership and their influence on employee coping mechanisms, innovation, and emotional wellbeing. The findings suggest that cultivating a failure-tolerant leadership style is instrumental in fostering a resilient and adaptive organizational culture.