High-quality patient care requires nurses with strong clinical competency. Thus, it is essential to examine the factors associated with clinical competency. This study was designed to (a) investigate head nurse leadership, staff nurse demographics, and clinical competency; (b) examine the impact of demographics on the clinical competency of staff nurses; (c) analyze the correlation between head nurse leadership and staff nurse clinical competency; and (d) examine the effects of demographics on clinical competency after controlling for the head nurse leadership. A cluster sampling method was used to collect data from 200 staff nurses at a national medical center in Taiwan. Questionnaires were used to gather information on head nurse leadership style and staff nurse clinical competency. Descriptive and inferential statistical analyses were conducted, including Mann-Whitney U test, Kruskal-Wallis test, Spearman's rank correlation coefficient, and multivariate analysis of covariance. The average score for transformational leadership style among the head nurses was 2.89, whereas transactional leadership style scored an average of 2.49. The average scores for the components of clinical competency, listed from highest to lowest, were as follows: patient care (3.35), professionalism (3.28), communication skills (3.18), management (2.84), and knowledge (2.73). In addition, statistically significant differences were found in clinical competency based on demographic factors, including age, marital status, educational level, job title, and length of employment. Also, a statistically significant, positive correlation between the head nurse transformational leadership style and nurse clinical competency was found. The main effect of length of employment on the five competency components was statistically significant after controlling for transformational leadership. Furthermore, post hoc analysis of covariance revealed a significant effect of length of employment on patient care, knowledge, communication skills, and management. The findings of this study indicate transformational leadership and employment length impact the clinical competency of staff nurses, particularly in terms of patient care, communication skills, management, and knowledge. Providing education and training in leadership and management to current and prospective head nurses may be expected to enhance clinical competency in staff nurses and create a more nurturing work environment. Moreover, targeted training may help current head nurses gain insight into their leadership styles and acquire skills to promote transformational leadership. In addition, leadership development may help equip prospective head nurses with critical competencies before assuming leadership responsibilities.