Two studies examined how the relationship between employees' perceived skills and challenges at work interacted with their need for achievement to influence positive mood, intrinsic task interest, and performance. The studies found that among highly achievement-oriented employees, experiencing high skills and challenges at work was associated with greater positive mood, task interest, and performance than other skill-challenge combinations. Positive mood also mediated the interactive relationship between skill-challenge levels and achievement needs on performance. The findings suggest that matching skills and challenges optimally may benefit employees and organizations by enhancing motivation and outcomes, particularly for those with high achievement needs.