Humor is a common element of human interaction and therefore has an impact on work groups and organizations. Despite the belief that business is serious, humor can lighten the mood within organizational environments and make work life more enjoyable. Humor has been described as an important component of organizational culture by creating a positive environment in which knowledge and ideas are shared freely and interpersonal relationships can flourish. Despite this, managers often fail to take humor seriously or realize its numerous benefits. Indeed, the proper use of organizational humor can provide valuable benefits to organizations-and even more valuable tools to management for motivating staff, communicating effectively, and mitigating discord. Humor is more than just funny concepts; it represents a multifunctional management tool that can be used to achieve many objectives. Managers can select the appropriate humor style suitable for the desired organizational outcome, adjust for individual differences, and achieve positive organizational outcomes. This article describes how nurse managers can use humor to reduce stress and enhance leadership, group cohesiveness, communication, creativity, and organizational culture.