<p>A thorough understanding of despotic leadership (DL) is essential, as it poses serious challenges to employee behavior, the workplace, and the organization as a whole. The present study consolidates existing research on DL, incorporating two frameworks, i.e., ADO (Antecedents-Decisions-Outcomes) and TCM (Theory-Context-Methodology). Drawing on 83 peer-reviewed studies sourced from Google Scholar, Web of Science, and Scopus, the review highlights how DL emerges and affects employees and organisations. In the context of ADO, DL is mainly linked to leaders’ traits such as lack of social responsibility and psychological entitlement, which drive coercive leadership decisions and defensive employee reactions, eventually leading to adverse outcomes such as psychological distress, silence, work withdrawal, and counterproductive behaviours, thereby collectively harming trust, ethical culture, and collaboration. Conversely, the TCM underscores a substantial reliance on Conservation of Resource (COR) and Social Exchange Theory (SET), an apparent geographical concentration in South Asia, and a methodological dependence on quantitative and survey-based designs utilizing a single measuring scale. Together, these trends restrain theoretical diversity and its generalizability. Moreover, the present review highlights that DL is an inherent relational issue rooted in power and cultural factors rather than a mere personal shortcoming. Future research ought to broaden the theoretical approaches, including underrepresented sectors and cultures, and employ mixed-method designs to gain comprehensive insights into how DL develops and how it can be addressed. Organisations can design fairer governance systems, accountable leaders, and promote cultures that discourage coercive control and fear-based management by recognizing DL as a relational and contextual phenomenon.</p>