The existing literature has established that leaders differentiate among their followers; however the focus has long been on the Western leader–member exchange (LMX) theory. This paper examines leader–member relationship differentiation from an indigenous leader–member guanxi (LMG) perspective. Using a sample of 60 groups and 228 employees we examined the dual effects of LMG differentiation on employee job satisfaction organizational commitment turnover intention and co-worker helping behavior after controlling for LMX LMX median and LMX differentiation. The results of this study supported the proposed dual effects of LMG differentiation demonstrating that LMG differentiation in general is detrimental to employees' work attitudes and their intentions to stay in an organization. On the contrary interestingly enough LMG differentiation can accentuate the positive relationship between LMG and job satisfaction organizational commitment and co-worker helping behaviors.