Purpose: This paper examines the mediating role of the team's entrepreneurial passion between positive leadership and team creativity in small and medium-sized enterprises. Design/methodology/approach: The data was collected from 604 Chinese SME team leaders. A structural equation model was used to analyze the direct and indirect effects of positive leadership, team creativity, and entrepreneurial passion. SPSS 16 and AMOS 23 software were used for statistical analysis. The findings are as follows: First, Positive leadership in small and medium-sized enterprises has a positive influence on the team's creativity. Second, positive leadership has a positive impact on the entrepreneurial passion of small and medium-sized enterprise teams. Third, the entrepreneurial passion of teams has a positive influence on the creativity of teams in SMEs. Fourth, in SMEs, the entrepreneurial passion of the team plays a mediating role between positive leadership and team creativity. Research limitations/Implications: This study is static and does not fully capture the dynamic process of team creativity in which positive leadership is involved through its long-term effects on team cognition and team emotions. The research focuses mainly on the team level but does not explore the complex relationship between positive leadership and team creativity. Originality/Value : This paper aims to support SME leaders in choosing the right team leader type and enhance team members' intrinsic cognitive and emotional strengths through positive leadership, thus providing helpful guidance for team creativity. We constructed a model based on social cognitive theory to test our research hypothesis.