I would like to add my learnings to the chain of excellent answers above.
1. Motivate, motivate, motivate:
A leader is a person everyone looks up to. You need to completely believe in set goals and how it will benefit the organization and its employees. You might give your employees all the resources necessary to complete their duties but if you cannot create the will and enthusiasm required to engross them, the chances of generating great results decreases over the period. Money might not at all be a motivating factor for several people. Many welcome an opportunity to make a difference and create a smile/make the world an easier/safer/greener place. You need to observe your co-workers and realize their passion. Let the bird fly and fish swim and not vice versa.
2. Assign ownership and not tasks:
Let everyone be the CEO of their job. Let them make decisions. If you can allocate just enough amount of responsibilities at the right time which can actually scare someone, the chances of performing well increases. Let your employees see the bigger picture and not be restricted to smaller modules.
3. Connect:
Listen to your audience-formal/informal feedback, body language, quality of work are all incoming signals. Figure out what's good and what needs work. Set up a roadmap and channel efforts towards fixing things. Be the driver.
Other important points that are already covered in the answers above:
1. Appreciate innovation
2. Deliver on promises
3. Set an example
4. Be amongst the crowd yet stand out
5. Praise in public, reprimand in private