Action learning plays a very effective role in leadership development. Action learning helps the leaders apply their learning. Action learning provides the knowledge, skills abilities at individual level. It provides the confidence on ones self to take the decisions and to work in risk situations. It helps the individual to unlearn its taken for granted norms and values and further it helps individual to deal with problematic situations and its options. Moreover it develops the listening and questioning skills which improves the knowledge, skills and abilities. These all are the insight abilities of a person to be a leader.This will lead the individual to communicate and work effectively within a group. This will help the person to make decisions with in a group by mutual participations. At departmental level effective participation leads to the leadership behavior. As in action learning people work in sets of 5-7 people who have to meet after decided time interval, so in that learning process individual will better create a knowledge to work within a group while working on problems individually by taking decisions from all other coworkers.