This study explored the relationships between supervisors' positive and negative mood contagion and employees' innovative behavior. We focused on the mediating effect of work engagement and burnout. Subjects in this study were 123 dyads of supervisors and employees from the creative department of advertising companies. Structural Equation Modeling was employed to test the hypotheses. Findings showed that: (1) employees' positive mood experience mediated the positive relationship between supervisors' positive mood expression and employees' work engagement. (2) Work engagement mediated the positive relationship between employee's positive mood experience and innovative behavior. (3) Employees' negative mood experience mediated the positive relationship between supervisors' negative mood expression and employees' burnout, but this influence subsequently did not affect employees' innovative behavior. The theoretical and practical implications are also discussed.