Being a leader in chat means you can use universal chat powers. A leader is picked for each user rank every three hours, and who is chosen depends on how recently they have chatted during the 10 minutes prior to leader assignment and how much they have spent on Groupees. Leadership changes will be announced in the chat of the currently featured bundle. You cannot become leader if you are a partner.
Being a leader, you are invulnerable to chat powers from your rank, and can use universal chat powers. Universal chat powers are chat powers that apply to all users that are below your rank in the channel that you used the chat power in. They are applied using the same method as standard chat powers, except clicking on the "Use an universal-superpower" button instead of the "Use a superpower" button. See article on chat powers for more details on the chat powers themselves. Please note universal chat powers do not work well in preorder bundle chats.
After using a universal chat power, you will become vulnerable, where another user can bomb you, and you'd lose your leader status. If the other user is the same rank as you, they will take your crown.
If you are of the Newbie rank, you will gain the ability to use chat powers. You can use chat powers two times at most before the leader status is assigned to another newbie and you can no longer use chat powers.
If you are leader of Fanfrog, Rockstars, or Boss, you can use chat powers on admins.