Purpose: The purpose of this paper is to examine the role of intermediate knowledge mechanisms on the participative leadership–employee exploratory innovation relationship using a distal mediation model. Design/methodology/approach: Deploying a time-lagged questionnaire method implemented over four business quarters, data are generated from 1,600 responses in R&D units of Taiwanese technology firms. Findings: The structural equation modeling results reveal that participative leadership is positively related to employee exploratory innovation; coworker knowledge and absorptive capacity partially mediate the relationship between participative leadership and employee exploratory innovation independently; and coworker knowledge sharing in combination with absorptive capacity partially mediates this relationship. Originality/value: The findings contribute new knowledge on the relationship between participative leadership and employee exploratory innovation by uncovering intermediate knowledge mechanisms that augment this relationship.