This study focuses on conceptualizing the phenomenon of organizations that are having relatively more interest in ethical behavior of leaders than ever before. Since few decades, their importance has grown due to increased level of unethical behavior on leaders’ parts and overstated responsibility drawn on their shoulders. Current research takes into account the leadership behavior of Government educational institutions heads in terms of creation of ethical climate in the institutions. For empirical testing of framework, data from 300 participants including principals, vice-principals, headmasters, deputy-headmasters working in (107) government educational institutions were taken through purposive sampling methodology. Various tests like descriptive statistics, regression correlational and factor analysis along with cross tabulation were executed through computer software like AMOS and SPSS. The results depicted that leadership behavior of ethical leaders was directed towards creation of ethical climate in the educational institutions. Results indicated a meaningful and positive effect of ethical leadership on Caring, Rules, Law and Codes, Independence ethical climate types but no significant influence on Instrumental type ethical climate. Keywords: Ethical leadership, Ethical climate, Law and Codes, Instrumental, Independence