This study provided initial evidence on antecedents of department-level entrepreneurial orientation in the public sector as well as how such entrepreneurial orientation is related to public value orientation. While in the private sector, an extant research stream has examined entrepreneurship within organizations (i.e., corporate entrepreneurship) and how this can be achieved, such research is rare in the public sector. However, the public sector differs from the private sector in many important ways, which makes the direct transferability of concepts difficult. Despite the acknowledged importance of middle managers in public entrepreneurship, very few studies have focused on this level of analysis. In this dissertation, a model based on previous research from private sector corporate entrepreneurship, public entrepreneurship, and public value management was developed to fill this gap. This model was tested empirically using data from Germany’s Federal Labor Agency’s middle management. Results based on structural equation modeling suggest that management support, staff motivation, multitude of expectations, managers’ localism, and managers’ tenure in current position/department influence department-level entrepreneurial orientation in this context. Furthermore, the data show a positive relationship between entrepreneurial orientation and public value orientation. These findings advance research on public entrepreneurship by testing a number of untested propositions and proving avenues of future research. Furthermore, public value management benefits through indications on how PVM can be implemented operationally. On the other hand, this dissertation also contributes to private sector research by questioning aspects of established concepts. While further data will be required to base knowledge on even stronger empirical evidence, this dissertation hopes to provide indications on how public sector organizations can help their middle managers engage in entrepreneurial behavior and create public value.