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Purpose Innovation and entrepreneurship competitions are employed as an important policy tool by the Chinese government and universities to promote entrepreneurship education and training. However, its effect has seldom been verified by empirical studies, especially in students’ leadership development, one of the core objectives of innovative talent cultivation. This study aims to test how undergraduate students’ participation and different team roles in innovation and entrepreneurship competitions can impact their leadership development. Design/methodology/approach Based on a questionnaire survey of 1,431 undergraduate students, this study used independent sample t-tests to verify the effect of whether to participate or not in innovation and entrepreneurship competitions on their self-reported leadership competence, and furthermore, to verify the effect of different team roles in the competitions on leadership improvement. Then, the propensity score matching method was used to verify whether team role was the most critical factor contributing to differences in leadership improvement. Findings The study found that undergraduate students who participated in the innovation and entrepreneurship competitions had significantly higher leadership value-added than non-participants. Among the students who participated in the competition, those who took the role of team leader were significantly better than team members in seven leadership dimensions, including sense of adventure, planning, information processing, problem solving and teamwork. They also differed in some individual educational experiences, family backgrounds and personal traits (especially vigor). The study verified that being a leader was a key factor in the difference of leadership improvement among undergraduate students. Originality/value On the one hand, the introduction of the vigor factor into the field of undergraduate student development expands the application space of the theory while verifying the role of vigor traits in students’ leadership behavior. On the other hand, it confirms the nurturing effect of innovation and entrepreneurship competitions in leadership and points out the direction of optimizing the quality of innovation and entrepreneurship education.