An ongoing challenge at U.S. federal agencies is to determine the most effective use of limited funds to successfully deliver services to customers. This public administration challenge is particularly troublesome in the current environment of federal budget cuts and rising customer expectations, especially in nonappropriated federal agencies. One opportunity for federal managers lies in their ability to foster supportive office environments in which employees feel psychologically safe to take risks, admit mistakes, and voice dissent. Research suggests these supportive environments can lead to increased levels of employee engagement. Further research suggests that increased levels of employee engagement can positively influence customer satisfaction. This study proposed and tested in a large federal agency a hypothesized correlation between the perception of psychological safety and customer satisfaction as mediated by employee engagement. The results indicate a positive, statistically significant relationship between federal employees’ perception of psychological safety and customer satisfaction at the office level, as partially mediated by employee engagement. These results supported the hypotheses and may serve to improve the appreciation in agencies and federal managers for the role that supportive office environments in which employees feel psychologically safe to take risks, admit mistakes, and voice dissent play in employee engagement and ultimately customer satisfaction. Keywords: Psychological Safety; Employee Engagement; Customer Satisfaction; Federal Government; Mediation Analysis; Public Administration;