Servant leadership has received a great deal of academic attention in recent years, and its core tenet is a servant-oriented leadership style for followers. Previous research has found positive effects of servant leadership, while this paper challenges this finding and offers a new perspective. Servant leadership emphasizes the service and assistance for all followers. However, as leaders have limited resources and time, servant leadership has the possibility to decentralize leaders’ attention, thus affecting team effectiveness. Based on a survey including 109 leaders and 636 followers, we find an inverted U-shape relationship between servant leadership behavior and the team-level in-role performance and extra-role organizational citizenship behavior (OCB) through team leader-member exchange differentiation (LMXD). Thus, this study extends the research on servant leadership and suggests that the middle level servant leadership behavior benefits team development most.