This study explores the effect of hiring engineers from leading firms on innovation in the context of follower firms, with a particular emphasis on the role of status distance between hired and incumbent engineers. While previous research highlights the positive effects of learning by hiring on innovation, this study delves into how status distance shapes knowledge flows and the psychological safety of hired engineers. Through empirical analysis, this study uncovered that status distance plays a crucial role in shaping these dynamics, influencing the flow of knowledge and its overall innovation capacity. Moreover, this research also finds that status distance affects the psychological safety of hired engineers with high status, leading to potential challenges in knowledge-sharing initiatives. Overall, this study provides nuanced insights into the complex dynamics of learning by hiring, contributing valuable insights to the broader discourse on the influence of hiring practices on innovation outcomes.