This paper reports on findings from a 3-year research project funded by Fundação para a Ciência e a Tecnologia (National Foundation for Science and Technology) aimed at examining conditions for teacher leadership in challenging circumstances. A mixed-method research design was devised, including a national survey on teacher professionalism (2700 teachers) and the policy context and interviews about professional culture and organizational features of the schools. Findings indicate that bureaucracy in teaching has increased with greater control over teachers’ work and greater accountability and public criticism of teachers. Ambiguity and ambivalence in teachers’ views and perceptions of both leadership and professionalism emerged from the data which may be linked to two levels in which their discourse may be associated: the rhetorical level – in which the language of policy shapes teachers’ discourse; and the practical – which has to do with what teachers actually do. Overall, this study provided empirical evidence of the complexity of teacher leadership in context and it highlighted the need to support and sustain teachers’ professional learning and innovative practices through the exercise of leadership. These and other issues will be explored further in the paper.