This systematic review examines the complex interplay between employee motivation and competitive dynamics within organizations. The study aims to identify cognitive and behavioral challenges affecting employee motivation, investigate the impact of workplace competitive dynamics, and propose strategies to enhance motivation and productivity. Based on the PRISMA Checklist, a systematic search was conducted between 2000 and 2023 across databases such as PubMed, PsycINFO, and Google Scholar. Upon initial screening, 11 studies were selected, which were evaluated for cognitive and behavioral factors influencing employee motivation within competitive organizational dynamics. The review identifies cognitive challenges, such as confirmation bias and attention-related cognitive errors, which have a significant impact on decision-making processes and motivation. A number of behavioral challenges affect job motivation, including ambiguity bias and a lack of attitudinal professionalism. Goal-setting, autonomy, and effective leadership are some of the strategies to improve motivation, as well as reducing biases and creating a conducive working environment. The review synthesizes the existing literature to provide a comprehensive understanding of the complex relationship between employee motivation and competitive dynamics. By identifying cognitive and behavioral challenges, providing insights into their interplay, and proposing practical strategies to improve organizational performance, it contributes to the improvement of organizations. By leveraging the identified challenges and strategies, organizations will be able to improve their decision-making processes and cultivate motivated employees. The findings revealed that a positive work environment and sustained employee engagement can be achieved by addressing biases, clarifying roles, fostering autonomy, and promoting effective leadership.