We invoke theory and research on the social functional view of envy to propose a novel theoretical framework of supervisory leader envy of direct reports. Findings from two multisource, multi-wave studies of supervisor-subordinate dyads provide support for the theses that (1) downward envy of subordinates threatens supervisors' self-esteem and triggers adaptive strategies in the form of abusive supervision and supervisory self-improvement; and (2) supervisors are more likely to respond to downward envy induced self-esteem threat with abuse when they perceive envied subordinates to be cold and competent and they are more likely to respond with self-improvement when they perceive envied subordinates to be warm and competent.